CBRE South Asia Pvt. Ltd., India’s leading real estate consulting firm, announced the findings of its retail market outlook.
The Indian retail sector has been evolving at a fast pace in the past couple of years. Increasing urbanisation, evolving brand preferences, availability of technology and social media have been the driving factors behind this evolution. In 2018, nearly 5.1 million sq. ft. of new retail developments became operational across the seven major cities in the country. Supply was led by the Southern cities, with Hyderabad at the forefront; followed by Chennai and Bangalore. Smaller retail developments also became operational in Delhi-NCR and Kolkata during 2018.
Demand has also been strong and the past couple of years have witnessed a divergence in the demand and consumption pattern of consumers in India. While fashion and apparel is expected to continue remaining a key demand stream (value fashion, along with mid-range fashion is expected to drive retail sales), but it has also given way to categories such as F&B, multiplexes and entertainment centres, along with accessories amongst others.
Retail Outlook for 2019:
Although nearly 10 – 12 million sq. ft. of supply is expected to come on-stream in 2019; demand is expected to outstrip supply. While changes in FDI norms for e-commerce may impact online sales in the short-term, it may also impact investor sentiment in the segment.
However, despite uncertainty across the e-commerce segment, omni-channel retailing is here to stay.
Diversification in demand to continue with expansion by various domestic and international brands across newer categories.
Experiential retail and placemaking will be the key, landlords and retailers likely to use tech for studying consumer patterns and enhance customer experience.