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Forecast Period
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2026-2030
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Market Size (2024)
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675.36 Million Sq. ft.
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CAGR (2025-2030)
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6.5%
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Fastest Growing
Segment
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Malls
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Largest Market
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West
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Market Size (2030)
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984.34 Million Sq. ft.
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Market Overview
India Modern Retail Space Market was stood
at 675.36 Million Sq. ft. in 2024 and is expected to reach 984.34 Million Sq.
ft. by 2030 with a CAGR of 6.5% during the forecast period. India’s modern
retail space market is experiencing robust growth, driven by increasing
urbanization, rising disposable incomes, evolving consumer preferences, and
rapid digitalization in retail operations. The market is segmented into various
categories, including departmental stores, apparel, food & beverages,
entertainment, home & lifestyle, hyper/supermarkets, electronics, watches
& Jewelry, personal care, footwear & sportswear, and others, catering
to the diverse needs of consumers. Occupancy type is classified into malls and
shopping streets, with malls witnessing significant expansion due to the
preference for organized retail experiences and integrated entertainment
facilities. The retail space is further segmented by size, ranging from small
stores (0-500 sq. ft.) to large flagship stores exceeding 3000 sq. ft., with
mid-sized stores (1001-2000 sq. ft.) gaining traction due to their cost-effectiveness
and operational efficiency.
Regionally, metro cities such as Delhi-NCR, Mumbai,
Bengaluru, and Hyderabad dominate the market, benefiting from high consumer
footfall and infrastructure development, while tier-2 and tier-3 cities are
emerging as new retail hubs due to increasing demand for organized retail. Key
growth drivers include favourable government policies such as FDI relaxation in
retail, rapid expansion of e-commerce players into offline stores, and growing
consumer inclination towards branded products and experiential shopping.
Competition in the market is intense, with domestic and international retail
chains vying for prime retail spaces, alongside real estate developers
investing in premium shopping complexes. The rise of omnichannel retailing and
demand for tech-enabled shopping experiences, including smart stores and
contactless payments, further fuel the market. Despite challenges such as high
rental costs and evolving consumer preferences post-pandemic, the market is
poised for significant growth, with forecasts indicating sustained expansion
through 2030, driven by continuous investment in retail infrastructure and
evolving business models.
Key Market Drivers
Urbanization and Rising Disposable Incomes
One of the most significant factors driving the
expansion of India’s modern retail space is rapid urbanization, accompanied by
a steady increase in disposable incomes. With India’s urban population
projected to reach 600 million by 2030, the demand for organized retail spaces
in metropolitan and emerging cities is accelerating. The growing middle-class
consumer base and the rise in dual-income households have increased
discretionary spending on lifestyle, apparel, electronics, and personal care
products, further fuelling demand for modern retail infrastructure. Additionally,
as consumers become more aspirational and brand-conscious, there is an
increasing preference for organized retail experiences, including shopping
malls, hypermarkets, and exclusive brand outlets. This shift is particularly
evident in categories such as apparel, footwear, electronics, and personal care,
where branded retail formats are gaining popularity. The penetration of global
retail chains and premium brands into India further strengthens this trend, as
consumers seek high-quality products and personalized shopping experiences. Tier-2
and Tier-3 cities are also emerging as key markets, as economic growth and
infrastructure development encourage retailers to expand beyond metro cities.
With improving connectivity, rising purchasing power, and changing consumption
patterns, regional malls and high-street retail formats are becoming prominent
in cities like Lucknow, Coimbatore, Indore, and Chandigarh, presenting new
opportunities for retail space expansion.
Expansion of Omnichannel Retailing
The increasing adoption of omnichannel retail
strategies by businesses is significantly impacting the demand for modern
retail space. Retailers are no longer relying solely on brick-and-mortar stores
but are integrating digital and physical retail formats to enhance consumer
engagement. The seamless blending of online and offline experiences has led to
increased store openings by brands that were traditionally digital-first, such
as Nykaa, Lenskart, and Pepperfry, highlighting the importance of physical retail
spaces in an era of e-commerce growth. With the rising penetration of
smartphones and internet access, Indian consumers are increasingly engaging in hybrid
shopping behaviours, where they browse products online but prefer in-store
purchases for experience-driven categories like fashion, beauty, electronics,
and furniture. Retailers are also investing in data-driven store layouts and inventory
management systems to optimize space utilization and enhance customer
experience. As a result, demand for modern, tech-enabled retail spaces is on
the rise, reshaping India’s retail landscape.
Infrastructure Development and Favorable Government
Policies
The expansion of retail-focused infrastructure and the
implementation of government policies favouring organized retail growth have
played a crucial role in shaping India’s modern retail space market. The increased
development of shopping malls, retail parks, and commercial complexes across
major cities and emerging urban centres is creating ample opportunities for
both domestic and international retailers. Government initiatives such as 100%
Foreign Direct Investment (FDI) in single-brand retail and 51% FDI in
multi-brand retail have encouraged global retailers like IKEA, H&M, and
Uniqlo to establish large-format stores in India. Similarly, FDI in e-commerce
has enabled online retailers to enter the offline retail space, further driving
demand for commercial retail properties. Additionally, the Smart Cities Mission,
which aims to enhance urban infrastructure in 100 cities, is significantly
contributing to the growth of organized retail. The development of metro rail
networks, highways, and business districts is increasing accessibility to
modern retail hubs, thereby boosting footfall and sales. The rise of real
estate investment trusts (REITs) is another factor driving growth in the retail
space market. Investors are increasingly considering retail real estate as a
lucrative asset class, leading to increased funding for premium shopping malls
and commercial retail projects. This has enhanced the overall quality of retail
spaces, encouraging both national and international retailers to expand their
physical presence in India.
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Key Market Challenges
High Rental Costs and Operational Expenses
One of the most significant barriers to the expansion
of modern retail spaces in India is the high rental cost of commercial
properties, particularly in metropolitan areas. Prime retail locations in
cities like Mumbai, Delhi-NCR, and Bengaluru demand exorbitant lease rates,
often accounting for a substantial portion of a retailer’s operating expenses.
The increasing real estate costs, coupled with maintenance charges, property
taxes, and utility expenses, put immense financial pressure on retailers,
particularly those operating on thin profit margins. Malls and shopping centres,
which are the preferred retail formats, also impose revenue-sharing models and fixed
rental commitments, making it challenging for brands to sustain long-term
profitability. Additionally, fluctuating economic conditions and inflation
impact operational costs, including labor wages, inventory management, and
supply chain logistics. For small and mid-sized retailers, sustaining
profitability in such an environment becomes difficult, often forcing them to
relocate to less expensive high-street locations or adopt cost-cutting measures
that may affect customer experience.
Shifting Consumer Preferences and E-commerce
Competition
Consumer shopping behavior in India is rapidly
evolving due to the widespread adoption of e-commerce and digital shopping
platforms. The convenience of online shopping, competitive pricing, and
extensive product variety have led to a shift in consumer preference away from
traditional brick-and-mortar stores. Major online marketplaces such as Amazon,
Flipkart, and Reliance’s JioMart, along with direct-to-consumer (D2C) brands,
have intensified competition for offline retailers by offering discounts,
faster deliveries, and easy return policies. Additionally, the rise of social
commerce and mobile shopping apps has further changedhow consumers interact
with brands. Many shoppers now prefer hybrid shopping models, where they
explore products in-store but make final purchases online. This trend has
created challenges for physical retailers in terms of footfall decline and
lower in-store conversions.To combat this, retailers are being forced to redefine
their physical stores by integrating experiential shopping elements,
personalization, and technology-driven solutions. However, the capital
investment required for digital transformation in retail spaces poses financial
and operational difficulties, especially for small retailers with limited
resources.
Regulatory and Infrastructure Constraints
Despite the government’s efforts to boost organized
retail, regulatory and infrastructural challenges continue to hinder the
sector’s growth. The complex real estate approval process, zoning restrictions,
and inconsistent state-level regulations create hurdles for new retail
developments and expansions. Obtaining licenses and complying with local policies
for land use, building codes, and taxation can be time-consuming and costly. Moreover,
inadequate urban infrastructure, such as traffic congestion, parking shortages,
and poor last-mile connectivity, affects footfall in malls and high-street
retail spaces. In smaller cities, underdeveloped transport networks and lack of
retail-friendly infrastructure further slowdown organized retail expansion.
Retailers in these regions often struggle with supply chain inefficiencies,
resulting in delayed inventory replenishments and increased operational costs.
Key Market Trends
Experiential Retail and Concept Stores
With growing competition from e-commerce,
brick-and-mortar retailers are focusing on experiential retail to enhance
customer engagement. Today’s consumers seek more than just a transactional
shopping experience—they want immersive, interactive, and personalized
experiences that online platforms cannot offer. This has led to the rise of concept
stores, flagship showrooms, and themed retail environments that emphasize
engagement rather than just sales. Experiential elements such as interactive
displays, VR/AR try-ons, and live product demonstrations are increasingly being
incorporated into stores, particularly in categories like fashion, beauty, and
electronics. Brands like Nike, Tanishq, and Apple have already introduced
flagship stores with unique design aesthetics and customer interaction zones. Retailtainment
(retail + entertainment) is gaining momentum, with malls integrating arcades,
escape rooms, and experiential food courts to attract footfall. Shopping
centers like Phoenix Marketcity and Select Citywalk are incorporating cultural
and lifestyle events to keep visitors engaged Personalized shopping experiences,
where customers can book consultations, customize products, and engage with
expert stylists, are becoming a key differentiator in premium retail.As brands
increasingly focus on customer engagement, experience-driven retail spaces are
expected to expand further, reshaping how physical stores operate.
Rise of Sustainability in Retail Spaces
Sustainability has become a core focus for retailers
and mall developers as consumers become more environmentally conscious. Green
retailing is no longer just a corporate responsibility initiative; it has
become a key differentiator that influences consumer choices and brand loyalty.
This has led to the adoption of Eco-friendly store designs using sustainable
materials, energy-efficient lighting, and solar panels to reduce carbon
footprints. Brands such as Fabindia and IKEA have been pioneers in promoting
sustainable retail spaces. Green-certified shopping malls with water recycling
systems, waste management strategies, and vertical gardens. Malls like DLF Mall
of India and Lulu Mall have integrated sustainable infrastructure to attract
both consumers and environmentally responsible retailers. Second-hand and
circular economy retail is emerging, with brands launching pre-owned and
refurbished sections in stores, particularly in the fashion and electronics
segments. Companies like H&M and Levi’s are running sustainability programs
that encourage customers to return used clothes for recycling. Zero-waste
packaging and sustainable product sourcing are also gaining traction,
particularly in the beauty and FMCG segments. Brands such as The Body Shop and
Lush emphasize eco-friendly packaging and refill stations. As sustainability
becomes a major factor in retail decision-making, green retail spaces will
continue to gain preference among developers and brands alike.
Growth of Premium and Luxury Retail
India’s growing affluent consumer base and rising
aspirations have fueled the expansion of premium and luxury retail in both
metro cities and emerging urban centers. The demand for international luxury
brands, designer fashion, high-end electronics, and gourmet food experiences
has created a strong market for high-street retail spaces and luxury malls. Luxury
malls and high-street shopping districts such as Palladium Mall (Mumbai), DLF
Emporio (Delhi), and UB City (Bengaluru) are attracting global brands like Louis
Vuitton, Gucci, and Rolex, indicating a strong demand for premium retail experiences.
Luxury automobile showrooms and experiential brand outlets are on the rise,
with companies like Mercedes-Benz and Tesla setting up large-format experience centres
in key Indian cities. Premium food and beverage retailing is also witnessing a
surge, with gourmet supermarkets like Foodhall and Nature’s Basket offering
high-end imported groceries, organic produce, and chef-led culinary experiences.
Tier-2 and Tier-3 cities are becoming new hotspots for luxury retail, with
rising HNI (High Net-Worth Individual) populations and aspirational consumers
driving demand for branded products. Cities like Lucknow, Indore, and
Chandigarh are witnessing increasing luxury retail penetration. With India’s luxury
market projected to grow at a double-digit rate, developers are investing in exclusive
premium shopping districts that offer a blend of luxury retail, fine dining,
and lifestyle experiences.
Segmental Insights
Based on Category, The hypermarkets and supermarkets
segment was dominated by discount and value retail, with Reliance Smart and
DMart offering bulk purchasing benefits. However, premium and organic grocery
chains such as Nature’s Basket are expanding rapidly, driven by rising health
awareness. Similarly, consumer electronics and mobile stores like Croma and
Reliance Digital lead the electronics retail segment, while smart wearables and
IoT devices represent the fastest-growing segment, fueled by demand for
smartwatches and home automation products. In watches & jewelry retail, branded
luxury watches and fine jewelry are the market leaders, with Titan, Tanishq,
and Malabar Gold appealing to affluent buyers. However, affordable and smart
jewelry brands like CaratLane and Bluestone are growing fast, with smartwatches
outpacing traditional watches among younger demographics. Personal care &
beauty retail is led by luxury and premium beauty brands such as Sephora and
MAC, but digital-first D2C brands like Sugar Cosmetics and Mamaearth are
expanding rapidly into offline retail.Overall, India’s modern retail market is
shifting towards digitalization, sustainability, and experience-driven shopping.
While metros continue to dominate leading segments, Tier-2 and Tier-3 cities
are the fastest-growing markets, presenting new opportunities for expansion.
The future of retail in India will be defined by innovative store formats, O2O
models, and the increasing integration of technology into shopping experiences.
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Regional Insights
In the Indian modern retail space market,
West India, comprising Maharashtra, Gujarat, Rajasthan, and Goa, is the
dominant region in India’s modern retail market. Maharashtra, with Mumbai and
Pune as retail hubs, leads the country to high-end malls, luxury shopping
destinations, and hypermarkets. The region has some of the largest and most
well-developed shopping centers, including Phoenix Marketcity, Palladium, and
High Street Phoenix in Mumbai, which house global brands such as Zara, H&M,
Sephora, and luxury outlets like Louis Vuitton and Rolex. Gujarat, especially
Ahmedabad, has seen rapid expansion of organized retail chains like Reliance
Smart, DMart, and Big Bazaar, while Rajasthan’s cities like Jaipur and Udaipur
are witnessing growing demand for premium lifestyle and apparel brands. The
presence of large-scale retail infrastructure, high disposable incomes, and a
strong urban consumer base makes West India the leader in modern retail space.
Recent Developments
- In 2024, BigBasket,
India's leading online grocery retailer backed by the Tata Group, has announced
plans to go public within the next 18 to 24 months. The company aims to double
its operations annually until March 2026 and expand its presence from 35 to
approximately 70 cities in the coming year. This move aligns with the growing
demand for quick online deliveries and positions BigBasket to compete with
rivals like Swiggy's Instamart and Zomato's Blinkit.
- In 2024, TTK
Prestige, a prominent Indian kitchen appliances manufacturer, plans to expand
its retail footprint by up to 30% over the next four years. The company
currently operates around 680 stores across 375 towns and aims to enhance its
presence in both large and smaller towns, anticipating a boost in consumer
spending following recent government income tax relief measures.
- In 2024, LuLu
Group International, a major retail conglomerate, continues its expansion in
India with the opening of a new mall in Kozhikode on September 9, 2024. This
mall features the largest LuLu Hypermarket, spanning 1.5 lakh sq ft, along with
LuLu Fashion Store, LuLu Connect, and Funtura. The group has also commenced
construction of new malls in Kottayam, Tirur, Ahmedabad, Chennai, and Varanasi,
reflecting its commitment to strengthening its retail presence across the
country.
- In 2024, Kalyan
Jewellers, established in 1993, operates 277 showrooms across India and the
Middle East as of July 2024. The company is set to enter the U.S. market and
plans to open 70 new showrooms globally, marking a significant step in its
international expansion strategy.
- In 2024, Metro
Brands, one of India's largest footwear specialty retailers, inaugurated the
country's first Foot Locker store on October 19, 2024, at Nexus Select City
Walk in New Delhi. This launch signifies Metro Brands' efforts to diversify its
offerings and introduce global retail experiences to the Indian market.
Key Market Players
- Trent Limited
- V-Mart Retail Limited
- Reliance Industries Limited
- Aditya Birla Fashion and Retail
- Avenue Supermart Ltd.
- Titan
- V2 Retail
- Raymond Ltd
- The Future Retail Group
- Spencer Retail
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By Category
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By Occupancy Type
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By Size
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By Region
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- Departmental Stores
- Apparel
- Food & Beverages
- Entertainment
- Home & Lifestyle
- Hyper/Supermarkets
- Electronics
- Watches & Jewelry
- Personal Care
- Footwear & Sportswear
- Others
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- 0-500 sq. ft.
- 501-1000 sq. ft.
- 1001-2000 sq. ft.
- 2001-3000 sq. ft.
- Above 3000 sq. ft.
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Report Scope:
In this report, the India modern retail space
market has been segmented into the following categories, in addition to the
industry trends which have also been detailed below:
- India Modern Retail Space Market,
By Category:
o Departmental Stores
o Apparel
o Food & Beverages
o Entertainment
o Home & Lifestyle
o Hyper/Supermarkets
o Electronics
o Watches & Jewelry
o Personal Care
o Footwear & Sportswear
o Others
- India Modern Retail Space Market,
By Occupancy Type:
o Malls
o Shopping streets
- India Modern Retail Space Market,
By Size:
o 0-500 sq. ft.
o 501-1000 sq. ft.
o 1001-2000 sq. ft.
o 2001-3000 sq. ft.
o Above 3000 sq. ft.
- India Modern Retail Space Market,
By Region:
o North
o South
o East
o West
Competitive Landscape
Company Profiles: Detailed analysis of the major companies presents
in the India modern retail space market.
Available Customizations:
India modern retail space market report with the
given market data, TechSci Research offers customizations according to a
company's specific needs. The following customization options are available for
the report:
Company Information
- Detailed analysis and
profiling of additional market players (up to five).
India Modern Retail Space Market is an upcoming
report to be released soon. If you wish an early delivery of this report or
want to confirm the date of release, please contact us at sales@techsciresearch.com