India’s retail market is seeing a change—malls are becoming more popular again as leasing on high streets fell by 26% in the second quarter (Q2) of 2025.
A recent report by real estate firm Cushman & Wakefield shows that malls made up 45% of total retail leasing in Q2, with 1.01 million square feet (MSF) leased. That’s a 42% increase compared to the previous quarter and the highest mall leasing share in the past five quarters. This trend suggests more people are interested in shopping in well-planned, experience-focused mall environments.
Even though high street leasing dropped, it still held the larger market share—55% or 1.23 MSF—mainly because there aren’t enough high-quality malls available in many cities.
The report, titled ‘Q2-2025 Retail Market Beat’, also found that no new malls opened in Q2, and the total new premium mall space in the first half of the year was 1.3 MSF. Due to this limited supply, mall vacancies fell to 8.16%, with top-grade malls having even lower vacancy rates at just 4.28%. This shows a strong demand for high-end retail space, giving mall owners more power in lease negotiations.
Meanwhile, rents on high streets remained steady quarter-on-quarter but increased by 6% compared to the same time last year.
Suvishesh Valsan, Head of Research India at Cushman & Wakefield, said high streets still lead in activity, but mall vacancies are falling fast, showing people now prefer quality and experience-led retail spaces. He added that nearly 4 MSF of new premium mall space is expected in the second half of 2025, especially in big cities like Mumbai, Delhi-NCR, and Hyderabad.
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He also mentioned more international brands are entering the Indian market, especially in wellness and grocery categories—pointing to changing shopping habits in India.
Domestic retailers continue to lead, taking up 86% of the total leasing space (1.93 MSF), while international brands increased their share to 14% (0.31 MSF), up from 8.5% in the previous quarter. Most of this growth came from malls, as global brands prefer structured, high-visibility retail spaces.
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Among cities, Hyderabad (0.76 MSF), Mumbai (0.52 MSF), and Delhi-NCR (0.3 MSF) were the top retail leasing markets in Q2, together making up more than 70% of all leasing. Other cities followed with Pune (0.23 MSF), Bengaluru (0.18 MSF), Chennai (0.16 MSF), Kolkata (0.05 MSF), and Ahmedabad (0.04 MSF).
