A rare combination of structural undersupply and accelerating consumption is underpinning India’s organised retail story. Despite rapid urbanisation, India’s per-capita retail stock remains among the lowest globally, with Tier-I cities offering just 4–6 sq ft per person and Tier-II and Tier-III markets even lower at 2–3 sq ft, as per Anarock research. Grade-A mall space averages ~0.6 sq ft per capita, a stark contrast to nearly 23 sq ft in the US, highlighting a deep and persistent supply gap that continues to attract long-term capital.
This is playing out against the backdrop of India’s transformation into a $6 trillion consumption economy by 2030, driven by rising income levels, a youthful demographic profile, and increasing urbanization. As an indicator of this strong growth story, retail leasing remains healthy with around 3.2 million sqft of retail space having been absorbed during Q3 of 2025 itself, representing a 65% YoY increase, with key markets like Delhi/NCR and Hyderabad showing strong leasing activity.
Harinder Singh Hora, Founder Chairman, Reach Group, said, “Developers are increasingly aligning retail assets with experience-led and omni-channel strategies, enabling brands to seamlessly integrate physical stores with digital platforms for fulfilment, returns and deeper customer engagement. As organised retail evolves, success is driven not just by scale but by curated experiences that encourage longer dwell times and repeat visits. Retail today is about curation, not just construction — where design quality, accessibility, compliance, efficient parking and a thoughtfully curated tenant mix come together to create destination-led environments. Developers who deliver immersive, lifestyle-oriented retail spaces with a clear consumer proposition are witnessing faster leasing momentum, stronger brand commitment, and sustained long-term growth.”
Jatin Goel, Executive Director, Omaxe Group, said, “India’s organised retail sector is moving into a high-investment growth cycle, backed by strong leasing momentum and institutional capital interest. Over the past few years, retail leasing absorption across the top cities has remained robust, with Delhi NCR consistently ranking among the leading markets. Vacancy levels in high-quality malls have tightened, while rental values and trading densities have shown steady appreciation, making organised retail an increasingly attractive yield asset. What is equally significant is the geographical diversification of demand. While established consumption hubs continue to perform, emerging corridors such as Dwarka and Faridabad are witnessing accelerated retail absorption due to infrastructure upgrades and dense residential catchments.”
On the sentiments of tier markets, he said, “Tier 2 cities, including Lucknow, New Chandigarh and Indore, are also recording rising pre-commitments from national and international brands as organised supply expands. In parallel, tourism and pilgrimage economies such as Ayodhya and Vrindavan are creating new retail investment micro-markets driven by year-round visitor footfall.”
He further added, “From a capital markets perspective, organised retail is gaining prominence within REIT and institutional investment strategies, given its ability to deliver stable annuity income supported by long-term leases. Integrated retail destinations such as Omaxe Chowk in Chandni Chowk and World Street in Faridabad reflect this evolving development thesis, where scale, experience design, and infrastructure alignment enhance both consumption performance and asset valuation. As India’s consumption story deepens, organised retail is expected to remain a core focus area for long-term real estate capital deployment.”
Delhi NCR has remained the hub driving growth in organised retail in India, with the region witnessing some of the strongest retail leasing activity in the country. The sustained retail activity in the Delhi NCR region has been driven by high footfalls, improved affluence levels across households, and a clear shift towards lifestyle-based retail consumption, which has seen retail malls being positioned as lifestyle destinations, rather than merely retail destinations.
Mitul Jain, Managing Director, SPJ Group, said, “The evolution of organised retail into a consumption- and experience-led asset class has significantly strengthened its investment appeal. Retail projects anchored by F&B, entertainment and lifestyle brands are generating higher dwell times and repeat footfalls, which directly translates into stronger sales performance for tenants and predictable rental yields for owners.”
Importantly, the retail upswing is closely linked to the region’s residential growth story, with strong housing sales, a sharp decline in unsold inventory and the expansion of urban belts across Gurugram, Noida, Greater Noida and Faridabad creating dense, consumption-ready catchments. As these residential clusters mature, demand for organised retail is deepening not only in established hubs but also in peripheral corridors, strengthening NCR’s position as the primary growth engine for India’s organised retail market.
The $3.5 billion that is estimated to be invested in retail real estate in India over the next three years reflects a distinct rotation of global capital into markets that promise growth and stability. It is this fact that makes India stand out-its strong occupancy levels, improving rental trajectories, and the inherent shortage of quality, organized retail assets-make it stand out amidst mature retail markets in the West, still fighting the offshoots of mall closures and weakening footfalls. This divergence is sharpening investor interest, with consumption-led demand remaining resilient across key urban centres. Institutional participation is also getting deeper, with the emergence of REIT structures and professionally managed retail platforms offering transparency, steady yields and long-term value creation, altogether positioning organised retail as a defensive yet growth-oriented investment play.
Bhupindra Singh, COO, RISE Infraventures, said, “Experience-driven retail is emerging as the next growth driver for retail real estate. Experience-driven retail that is integrated with offices, residences and hospitality creates a captive audience and all-day footfalls. These formats are increasingly being favoured by investors looking for long-term, stable income rather than short-term transactional gains.”
Looking ahead, the investment case for organised retail is increasingly being shaped by its ability to evolve. This evolution is also expanding the growth canvas beyond the top metros. As these markets mature, they are expected to play a decisive role in redefining India’s retail landscape and anchoring the next wave of long-term retail real estate investments.