March 23, 2023

The Financial Express

CBRE South Asia Pvt. Ltd, India’s leading real estate consulting firm, has announced the findings of its latest retail report, ‘CBRE India Retail Figures H1 2022’. The report indicates that the retail sector leasing in India increased by about 166% Y-o-Y crossing 1.5 million sq. ft. As of H1 2022, the total investment grade mall stock crossed over 77 million sq. ft.
CBRE Group Inc. Cl A (CBRE) shares listed on NYSE trade at around $79 and are down by around 20% in the last 1-year.
The report points out that among the cities, Delhi-NCR and Pune, followed by Bangalore and Hyderabad, led the leasing activity, together accounting for more than 70% of the overall retail space take-up. As per the report, pent-up supply is likely to enter the market during H2 2022, and the total supply for the year is anticipated to surpass the pre-pandemic levels.
Fashion and apparel retailers continued to drive the leasing activity with a share of 32% in H1 2022. Other prominent categories that led the leasing activity during H1 2022 included supermarkets (12%) along with homeware and department stores (12%). The entertainment category, which was impacted the most during the pandemic, has also emerged as one of the top demand drivers during H1 2022, with an 11% share in the overall demand. Leasing momentum is expected to pick up in H2 2022 owing to the anticipated space take-up in newly completed malls.
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The report also observed that due to strong demand from retailers across investment grade malls and prominent high streets, rental values increased on a half-yearly basis in select micro-markets across most cities. Among high streets, rents rose by about 5-12% across select locations in Delhi-NCR, Bangalore, Hyderabad, and Pune, and about 1-3% in Mumbai. While prominent mall clusters in Pune and Delhi-NCR witnessed rental growth of 5-11% on a half-yearly basis, a marginal increase of 1-3% was reported across one mall cluster in Mumbai.
Anshuman Magazine, Chairman & CEO – India, South-East Asia, Middle East & Africa, CBRE, said, “It is evident that retailers have regained confidence and are set for expansion mode. We anticipate that going forward, domestic brands will remain proactive in relocations/expansions, and a strong appetite from international retailers will continue.
We foresee retail leasing to touch 6-6.5 million sq. ft. in 2022, twice the 2021 quantum. Additionally, owing to the tremendous growth potential, we expect many international brands to launch stores in tier II and III markets.”
Ram Chandnani, Managing Director, Advisory & Transactions Services, CBRE India, said, “We expect nearly 5.5 – 6.0 million sq. ft. of new investment-grade malls to become operational during the year, an annual growth of nearly 40%. Accounting for nearly an 85% share in the overall investment-grade mall completions, Hyderabad, Delhi-NCR, and Bangalore are expected to dominate retail supply addition in H2. Moreover, Mumbai and Chennai are also anticipated to witness supply addition. Among the consumer segment, fashion and apparel retailers will continue to expand their physical sales networks and pay particular attention to enhancing flagship stores.”
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CBRE Group, Inc. (NYSE: CBRE), a Fortune 500 and S&P 500 company headquartered in Dallas, is the world’s largest commercial real estate services and investment firm (based on 2021 revenue). The company has more than 105,000 employees (excluding Turner & Townsend employees) serving clients in more than 100 countries. CBRE serves a diverse range of clients with an integrated suite of services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services.
As a leading international property consultancy, CBRE provides clients with a wide range of real estate solutions, including Strategic Consulting, Valuations/Appraisals, Capital Markets, Agency Services, and Project Management. The guiding principle at CBRE is to provide strategic solutions that make real estate holdings more productive and economically efficient for its clients across all service lines.
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