Over 1m sq ft of luxury malls to be operational in Mumbai by year-end

Nearly 670,000 sq ft of mall leasing activity was witnessed in 2023.

In the last quarter of 2023, Mumbai witnessed leasing of close to 310,000 sf in grade-A malls, according to a report from Cushman and Wakefield. The leasing activity constituted largely space take-up of anchor stores in the Fashion and F&B segment across the core city and eastern suburban malls. 

Fashion and F&B segments drove quarterly leasing with more than 60% share in leasing volume, followed by the accessories & lifestyle segment. 

Here’s more from Cushman and Wakefield:

Annually, in 2023, the city’s mall space witnessed close to 670,000 sf of leasing activity, largely driven by term renewals of existing brands under fashion, F&B and accessories & lifestyle segment brands. 

With a newly launched luxury retail mall in November in the prime suburban location, many international retail luxury brands are set to make their debut in the city. Despite new retail space added this quarter, city mall vacancy marginally dipped to 8.3% during the quarter. Superior category malls continue to enjoy tight vacancy levels of 1.10%. 

Close to 1.12 msf of Grade A supply is expected to be operational by the end of 2024 across the suburban micro markets. Delay in retail supply is expected to bring down city vacancy levels in upcoming quarters.

Fashion and Furnishing segments contribute highly to main streets leasing in Q4 

Prominent main streets in Mumbai witnessed strong leasing activity with close to 87,000 sf of store openings. Fashion segment accounted for a majority of leasing volume, primarily in locations such as Bandra and Colaba. The furniture & furnishings, health & wellness segments brands were active in these submarkets. 

In 2023, the city's main streets witnessed over 310,000 sf leasing activity, much higher than that in the previous year. Segments like F&B, Fashion and Accessories & Lifestyle drove main street leasing activity in 2023. 

Malls and main street rentals improve in Q4 

City-wide mall rentals witnessed an uptick on a q-o-q basis on the back of limited space availability and active term renewals. Prominent main streets in prime locations also witnessed a rental appreciation of 2-6% during this quarter on the back of good demand. 

Mall rentals are expected to broadly remain range-bound going forward despite the upcoming Grade A mall that will enhance the city's mall inventory significantly, largely owing to high levels of pre-commitments expected in these malls.