-By Ankita Dutta.
The Indian retail sector has seen impressive growth, with leasing increasing by 130 per cent year on year to 1.5 million square feet in the first quarter of 2023. The fashion and apparel sector had the largest share of total leasing activity at 31 per cent, followed by homeware and department stores at 19 per cent, according to new data from a report by CBRE South Asia, titled “India Market Monitor – Q1 2023”. The report also shows that supply increased by 474 per cent during the same period to 1.1 million square feet.
The world’s biggest commercial real estate services and investment company is CBRE Group, Inc., which is also a Fortune 500 and S&P 500 member. It was disclosed by Anshuman Magazine, who is the CEO and Chairman of CBRE India, South-East Asia, Middle East and Africa, that there will be an excess in retail supply capacity compared to the levels in 2022 due to the build-up of new supply. According to Magazine, there are numerous investment-grade initiatives launched over the last two years that are due to start operating in 2023, leading to an increase in primary leasing, which he predicts will become
the primary factor driving the demand for retail spaces in 2023.
Ram Chandnani, MD of Advisory and Transaction Services for CBRE India, noted that retailers are seeking spaces beyond conventional malls and high streets. Chandnani explained that this approach aims to diversify their locations, enabling supply chain modifications and allowing customers to shop for any product at any time. Chandnani predicts that initiatives such as metaverse and social commerce will receive greater attention, prompting more omnichannel investment.
The retail industry in India is undergoing major changes following an increase in digitisation, disruptive technologies, and shifting consumer expectations. The pandemic has accelerated these changes, with retailers refocusing on customer experience, supply chain efficiency, and leveraging technology to optimise their operations. Online shopping has become increasingly popular due to the pandemic, which has created a hybrid shopping experience for consumers.
The retail sector in India is still mostly unorganised, with a limited number of organised players. However, the industry has evolved in recent years, with various shopping centre formats and a wide range of international brands entering the Indian market. In the future, retailers will have to adopt a more flexible strategy to attract and retain customers in a highly competitive market. As per the CBRE report, Indian retail supply is expected to rise, giving retailers the opportunity to implement more innovative strategies. The report also suggests that there will be an increased emphasis on sustainability and creating social impact in the retail sector.
