Photo by <a href="https://unsplash.com/@freestocks?utm_source=unsplash&utm_medium=referral&utm_content=creditCopyText">freestocks</a> on <a href="https://unsplash.com/photos/photo-of-woman-holding-white-and-black-paper-bags-_3Q3tsJ01nc?utm_source=unsplash&utm_medium=referral&utm_content=creditCopyText">Unsplash</a>
New Delhi: India’s organised retail real estate market recorded strong growth during the first half of 2026.
Gross retail leasing rose 20 per cent year-on-year to reach approximately 3.9 million square feet. According to a comprehensive report by real estate consultancy CBRE, this expansion reflects sustained retailer confidence despite ongoing inflationary pressures and geopolitical uncertainties.
[H1 2025 Gross Leasing] ───( 20% Year-on-Year Increase )───> [ H1 2026 Total Leasing ]
3.25 Million Sq Ft 3.9 Million Sq Ft
Fashion and Apparel Dominates Total Space Absorption
Significantly, fashion and apparel brands remained the primary driver of market demand. The segment accounted for approximately 40 per cent of total space absorption during the January–June period.
Breakdown of Sectoral Space Absorption:
Fashion & Apparel: Captured 40 per cent of total space, led by department stores, mid-range brands, and athleisure lines.
Food & Beverage (F&B): Secured 14 per cent of total leased space.
Entertainment Formats: Accounted for 9 per cent of leasing activity.
Jewellery & Home Furnishings: Contributed 7 per cent each to total uptake.
Consumer Electronics: Maintained a stable 6 per cent market share.
Concurrently, around 0.9 million square feet of fresh retail supply became operational during H1 2026. Notably, Delhi-NCR accounted for the entire new supply delivered during the first half of the year.
Aggressive Expansion Across Tier-II Emerging Markets
Beyond major metropolitan centers, retailers expanded aggressively into emerging Tier-II cities to capture rising regional demand.
[Chandigarh & Jaipur] ──▶ Fashion & Apparel Captured 69% of Total Leasing
[Kochi Retail Market] ──▶ Fashion & Apparel Captured 65% of Total Leasing
Domestic retailers drove more than 70 per cent of total leasing activity throughout the six-month window. Furthermore, direct-to-consumer (D2C) brands expanding into physical storefronts captured roughly 28 per cent of total leasing volume.
Key Market Expansion Pillars:
Domestic Retailer Share: Generated over 70 per cent of total leasing volume.
D2C Brand Offline Entry: Accounted for 28 per cent of physical retail uptake.
Infrastructure Impact: Expanding metro lines and ring roads are broadening shopping catchment areas.
Looking ahead, CBRE expects upcoming Grade A retail assets and major infrastructure projects to sustain this upward momentum. Ultimately, shopping malls will increasingly transition toward experience-led formats and mixed-use developments to boost consumer engagement.
India Organised Retail Leasing Breakdown
| Market Parameter / Metric | Performance Milestone (H1 2026) | Primary Demand Driver | Strategic Sector Impact |
| Gross Retail Leasing | 3.9 Million Sq Ft (+20% YoY) | Fashion and apparel store rollouts. | Reaffirms brick-and-mortar retail expansion. |
| Fashion & Apparel Share | 40% Total Space Absorption | Department stores and athleisure lines. | Serves as the primary anchor for shopping malls. |
| Fresh Retail Supply | 0.9 Million Sq Ft | Concentrated entirely in Delhi-NCR. | Expands modern Grade A retail inventory. |
| Domestic vs D2C Mix | 70% Domestic / 28% D2C | Omnichannel expansion by online brands. | Accelerates physical store openings for D2C brands. |
| Tier-II Market Penetration | 65%–69% Absorption Rate | Strong retail demand in Jaipur, Kochi, and Chandigarh. | Broadens organized retail beyond tier-1 cities. |
About the Author
