Mumbai’s retail supply pipeline at nearly 4m sq ft over the next four years

Only one project is expected to be added by Q3.

In a report, JLL revealed that the Jio World Centre at BKC in Mumbai’s Prime North submarket is expected to be operational by 3Q23. Supply of around 3.6 million sq ft is otherwise scheduled to come on-stream in the next four years.

Here’s more from JLL:

In 1Q23, demand in the Mumbai retail market witnessed a significant rise due to healthy absorption in The Capital Mall in the Suburbs submarket. Total absorption stood at around 146,500 sq ft in the quarter.

Most of the leasing activity was recorded in Prime South and Suburbs submarkets. Brands like Decathlon, PVR, Jugheads, Being Human, Raymond, Third Wave Coffee, Timezone Entertainment, Van Heusen Active and Fossil took up space in The Capital Mall, Phoenix High Street Mall, Oberoi Mall and Seawoods Grand Central Mall.

Rents increase slightly in 1Q23

Overall rents increased slightly in 1Q23, backed by improving leasing activity in malls and increased footfall, which allowed developers and landlords to harden their stance during negotiations.

Rents and capital values increased in all submarkets due to the better performance of prominent malls across submarkets. Yields declined marginally across all submarkets as capital values increased at a faster rate than rents.

Outlook: Market potential to be driven by quality upcoming supply

The future of the retail market looks more optimistic now as we are seeing retail brands invest in immersive client experiences and new formats that attract more foot traffic. The entertainment category, which was the most impacted during the pandemic, has provided a major boost to mall performance in the quarter.

The retail sector is expected to see more traction across all submarkets due to upbeat market sentiment. Jio World Centre at BKC is likely to complete in 3Q23 in the Prime North submarket with healthy pre-commitments. From setting up digital stores to automating an end-to-end supply chain, retailers are transforming business processes to align with changing consumer needs.

Note: Mumbai Retail refers to Mumbai's overall prime retail market.