Retail leasing up 69% in H1 2025 to 5.7 mn sq ft; Bengaluru, Delhi NCR lead in Q2: JLL report

India’s retail sector leased 2.6 mn sq ft in Q2 2025; FY25 leasing expected to surpass 10 mn sq ft as new malls open across top cities, JLL said

India’s retail real estate sector saw a 69% year-on-year growth in leasing activity during the first half of 2025, where the top seven cities recorded 5.7 million sq ft of retail space leased, a report by JLL said. While Q2 2025 contributed 2.6 million sq. ft. to the total, it was a 15% dip from the 3.1 million sq. ft. leased in Q1, a short-term decline attributed to a lack of new supply during the April-June period.

India’s retail real estate sector recorded a 69% year-on-year growth in leasing activity in the first half of 2025, with 5.7 million sq. ft. of space leased across the top seven cities, according to a report by JLL. (Picture for representational purposes only) (Pixabay)

"Despite this scenario, a 165% YoY growth in new mall supply was noted in H1 2025 as sizeable mall supply across Mumbai, Delhi NCR, and Hyderabad came on the block in the first quarter. Interestingly, the first half of 2025 has already achieved 70% of last year’s annual leasing volume, which stood at 8.1 million sq. ft," the report said.

Bengaluru and Delhi NCR lead retail leasing

Bengaluru (0.67 mn sq ft) and Delhi NCR (0.53 mn sq ft) emerged as the top performers in Q2, contributing a combined 46% of the gross leasing volume. Bengaluru stood out for its strong take-up in the jewellery and home furnishings categories, while food and beverage dominated retail leasing in Delhi NCR.

Hyderabad and Mumbai each added 0.51 ms sq ft and 0.49 mn sq ft of leased space, while Chennai and Kolkata saw modest quarter-on-quarter improvements. P

Fashion and apparel continued to lead the retail leasing categories, accounting for 33% of gross leasing in Q2, followed by food and beverage at 22%. Notably, jewellery overtook entertainment for the third spot, with a 9% share, leasing 0.23 million sq ft, primarily in South India and the Delhi NCR region. “This quarter saw a few European jewellery brands entering the Indian market, while indigenous players dominated overall,” said Samantak Das, chief economist and head of research and REIS, India, JLL.

International brands gain ground as India retains global appeal

The report stated that domestic retailers held 85% of the market share in Q2, while international brands expanded their footprint with 13 new entrants, seven of which were in the food and beverage segment. These global retailers leased a total of 0.4 million sq. ft. during the quarter. Bengaluru, which alone contributed a quarter of national retail leasing, continues to be a hub for new store launches.

"India's strategic appeal is drawing more international players, with foreign brand entries more than doubling year-on-year in H1 2025," said Rahul Arora, senior managing director, Karnataka and Kerala, JLL India. “Young demographics, rising disposable incomes, and a growing appetite for premium experiences are helping India stand out globally.”

Outlook for H2 2025

JLL expects nearly 5.9 million sq. ft. of new retail space to become operational in the second half of 2025, with upcoming malls across Delhi NCR, Bengaluru, Hyderabad, and Pune.

"With these new additions to the retail stock, the gross leasing activity is expected to reach new heights and cross the 10 million sq ft annual mark in 2025", it said.