Retail Leasing Hits Three-Year High in 2025

Delhi NCR led leasing activity with 3.02 million square feet, followed by Bengaluru at 2.97 million square feet, Hyderabad at 2.91 million square feet and Mumbai at 2.1 million square feet. Kolkata recorded leasing of 0.65 million square feet, Chennai 0.59 million square feet and Pune 0.24 million square feet.

JLL said the retail sector recorded a three-year high as gross leasing volumes surged 54 per cent year-on-year, signalling renewed confidence among retailers despite global economic uncertainty. Gross leasing includes retail space in shopping malls, high streets and prime retail developments.

In 2025, shopping malls accounted for 45 per cent of total leasing activity, while high streets commanded a dominant 48 per cent share. After moderating in 2024, retail leasing rebounded sharply in 2025, driven by rising discretionary spending, premium brand expansion and new supply.

The fourth quarter of 2025 emerged as the strongest period, with 3.6 million square feet of leasing recorded during the quarter. Around 6.3 million square feet of new retail supply was added during the year, enabling aggressive store rollouts across major urban markets.

Delhi NCR, Bengaluru and Hyderabad emerged as the top three retail markets, together accounting for 71 per cent of total leasing. Delhi NCR and Bengaluru each contributed 24 per cent of leasing activity, followed by Hyderabad at 23 per cent. Mumbai accounted for 17 per cent of leasing, while Chennai, Kolkata and Pune witnessed relatively limited activity due to supply constraints.

The top seven cities accounted for nearly 92 million square feet of mall stock in 2025. During the year, Delhi NCR, Hyderabad and Mumbai witnessed the launch of 15 shopping malls, contributing significantly to the nation’s overall mall inventory. The availability of premium institutional-grade mall space encouraged retailers to accelerate store launches in prime locations.

Domestic retailers remained the backbone of the market, accounting for 82 per cent of total leasing during the year. Retail space take-up by Indian brands exceeded 10 million square feet in 2025, up from 6.5 million square feet in 2024. Domestic brands expanded across both malls and high streets, with a growing preference for larger store formats.

Fashion and apparel continued to lead leasing with a 34 per cent share, while the food and beverage segment gained momentum, rising to 20 per cent in 2025. Direct-to-consumer brands accelerated physical expansion, leasing 0.9 million square feet during the year, supported by strong growth in fashion, beauty, jewellery and wellness categories.

Foreign brands also strengthened their presence, recording 36 per cent year-on-year growth in leased space, with 29 new international brands entering India, the highest in five years. JLL noted that nearly 47 million square feet of mall space is under construction across the top seven cities and expected to become operational by 2030.

The report highlighted that evolving consumer preferences and rising consumption spending will require developers to integrate technology, hospitality and experience-driven elements into future retail developments. Over the past five years, India’s retail sector has attracted about USD 2.3 billion in institutional investment, with future-ready retail assets expected to continue drawing capital.