Food and Beverage sector drives retail leasing in India with 4 mn sq ft, set to add 6 mn sq ft by 2028: JLL report

F&B sector drives 4 mn sq ft retail leasing in India; Bengaluru leads with one-third share, followed by Mumbai and Delhi NCR

India’s Food and Beverage (F&B) sector has become a key driver of retail real estate growth, recording about 4 million sq ft of leasing across seven major cities since the last two years. Bengaluru led the trend, accounting for nearly one-third of this activity. In response to strong demand, developers plan to allocate up to 25% of space in upcoming destination malls to F&B. By 2028, around 6 million sq ft of F&B space is expected to come up across the top seven cities, a report by JLL India has said.

India’s Food and Beverage (F&B) sector has emerged as a key driver of retail real estate, clocking about 4 million sq ft of leasing across seven major cities, with Bengaluru leading the trend. (Photo for representational purposes only) (Unsplash (representative image))

Mumbai and Delhi NCR, alongside Bengaluru, form the trinity driving two-thirds of the national leasing activity, while Delhi NCR stands out with 26% of the drinking establishment growth and a unique preference for mall-based F&B formats over high streets, the report noted.

The seven cities include Bengaluru, Mumbai, Delhi NCR, Chennai, Hyderabad, Kolkata, and Pune.

High streets drive over 50% of F&B leasing, with Indiranagar in Bengaluru as the top choice

According to the report, high streets have emerged as the preferred destination for F&B operators, accounting for 54% of total gross leasing across top cities. This preference stems from organic expansion opportunities provided by high streets compared to traditional shopping mall formats.

Bengaluru has established itself as the undisputed F&B leader, securing more than one-third of total leasing volume. Indiranagar remains a preferred destination for operators. Mumbai and Delhi NCR follow as key markets, collectively contributing to a sector that demonstrates resilience and robust growth potential.

“The F&B sector is fundamentally reshaping India’s retail real estate landscape. We are witnessing a paradigm shift where developers are planning to dedicate up to 25% of space in upcoming destination malls to F&B – a clear response to the segment’s robust demand dynamics. With six million sq ft of dedicated F&B space expected to become available across the top seven cities by 2028, we anticipate rapid absorption within 3-5 years, driven by both domestic and international operators seeking quality retail locations," said Samantak Das, Chief Economist and Head of Research and REIS, India, JLL.

The report noted that high streets continue to dominate F&B leasing activity, accounting for over 50% of transactions in the past 30 months. “This trend signals that the sector’s appetite for prime real estate extends well beyond traditional mall formats, positioning F&B as a cornerstone of India’s evolving retail ecosystem," Das said.

US-based brands lead F&B expansion in India

According to the report, the sector’s growth trajectory has attracted significant attention from international operators, with over 20 new global F&B brands having entered India since 2023.

US-based brands led international expansion, while Delhi NCR and Mumbai remain hotspots for global brands establishing their maiden Indian presence. The report said multi-cuisine establishments dominated the landscape with a 41% share of leasing activity, reflecting India’s evolving palette influenced by travel and global influence.

“India's retail sector has demonstrated remarkable resilience, with over 22 million sq ft of leasing activity despite global headwinds. The growth story is truly a tale of multiple cities, each carving its unique niche. Bengaluru has emerged as the undisputed leader, not just dominating F&B absorption with over one-third market share but also spearheading the craft beverage revolution with 40% of new pubs and breweries," said Rahul Arora, Head - Office Leasing and Retail Services, Senior Managing Director (Karnataka, Kerala), India, JLL.

"Mumbai and Delhi NCR, alongside Bengaluru, form the trinity driving two-thirds of the national leasing activity, while Delhi NCR stands out with 26% of the drinking establishment growth and a unique preference for mall-based F&B formats over high streets. The southern markets, including Chennai and Hyderabad, along with Kolkata, are showcasing vibrant high street F&B activity, while Pune mirrors Delhi NCR's mall-centric approach. This diversified, regionally-balanced growth reinforces that India’s retail expansion isn’t just robust, it’s strategically distributed across our key metros,” Arora said.

According to the report, the retail real estate sector has witnessed unprecedented growth, with 18.6 million sq ft of new shopping mall space added across the top 7 cities over the past five years, bringing total operational Grade A stock to 88.7 million sq ft. Despite global uncertainties, retail leasing has remained robust with over 22 million sq ft absorbed between 2023 and H1 2025.

The report said that shopping malls led the leasing activity with a 52% share. It said that between 2018 and H1 2025, approximately 2.5 billion US dollars in institutional capital flowed into the sector across 22 deals, with 30 institutionally owned developments now spanning 20.6 million sq ft across the top seven cities.