India’s organised retail real estate market is entering a new phase, with larger shopping malls, experience-led consumption and office-linked retail reshaping the sector across major cities.

According to CRE Matrix’s India Real Estate Horizons – Retail 2026, organised retail stock across 12 major markets has reached 186.2 million sq ft, nearly nine times the level seen two decades ago. Shopping malls account for 114.3 million sq ft, followed by Office Led Amenity Retail at 51.7 million sq ft and High Streets at 20.2 million sq ft.

The growth, however, is becoming increasingly uneven across cities and formats.

Bengaluru has the largest organised retail stock at 29.2 million sq ft, followed by Gurgaon at 27.4 million sq ft, Hyderabad at 24.8 million sq ft and Mumbai at 23.8 million sq ft.

Bigger malls, changing tenant mix

The next phase of mall development is expected to be dominated by larger destination-led assets. India has around 40.4 million sq ft of shopping mall supply in the pipeline through 2030, with Hyderabad and Gurgaon together accounting for 51% of the identified supply.

The average size of new shopping malls has also increased sharply. From around 0.25 million sq ft in the pre-2000 period, the average size is projected to reach 0.59 million sq ft during 2026-30.

This reflects the changing role of malls. Rather than being primarily shopping destinations, newer malls are increasingly being designed around dining, entertainment, leisure and other experiences that encourage consumers to spend more time at the property.

The shift is visible in leasing patterns. Experience-led categories such as fashion, food and beverage (F&B), entertainment, leisure and wellness accounted for 72% of mall leasing during 2023-25, compared with 54% a decade earlier.

Apparel and fashion alone increased its share from 25% to 35%, while F&B rose from 11% to 15%.

At the same time, traditional anchor categories have lost ground. Department stores and MBR, along with essentials and grocery, together accounted for 11% of leasing demand in 2023-25, down from 31% during 2013-15.

Office-linked retail gains ground

Another significant change has been the emergence of Office Led Amenity Retail.

The format now accounts for 51.7 million sq ft across the 12 markets tracked by the report. Around 15.4 million sq ft was added between 2021 and 2025, the highest addition in any five-year period.

Gurgaon has the largest Office Led Amenity Retail stock at 10 million sq ft, followed by Mumbai at 8.4 million sq ft and Pune at 7.4 million sq ft.

The growth reflects the changing nature of Grade A office developments, where retail and consumption spaces are increasingly integrated into workplace environments rather than being treated simply as convenience facilities.

Retail performance diverges across cities

Rental and vacancy trends show that India’s retail market is becoming increasingly city-specific.

Mumbai has the highest shopping mall rents at ₹438 per sq ft per month, while Ghaziabad records ₹140 per sq ft per month, creating a gap of ₹298 per sq ft.

Grade A shopping mall vacancy also varies considerably. Thane has the lowest vacancy at 1%, while Gurgaon records 13.6%.

The report suggests that factors such as asset quality, catchment strength and supply discipline are becoming increasingly important in determining the performance of individual retail assets.

Mumbai and Bengaluru recorded the strongest three-year shopping mall rental growth at 22%, compared with 11% growth at the pan-India level.

High Streets continue to command significant rents in prime locations. Rentals range from around ₹400 per sq ft per month in Hyderabad and Chennai to ₹3,000 per sq ft per month in the NCR, with Mumbai at ₹1,500 and Pune and Bengaluru at ₹800.

Retailers seek flexibility, but longer lock-ins

Retail leasing structures are also changing.

Average lease tenure declined from 75 months in 2021 to 70 months in the first half of 2026. At the same time, average lock-in periods increased from 22.2 months to 28.6 months.

As a result, the average lock-in now accounts for 40.9% of the overall lease term, compared with 29.6% in 2021.

The combination suggests that retailers are seeking shorter overall commitments while landlords are securing longer periods during which tenants cannot exit.

Demand for mall space has also remained relatively strong. Leasing exceeded new shopping mall supply in five of the seven half-year periods since the first half of 2023, indicating that occupier demand has generally remained ahead of fresh completions.

India’s organised retail market is therefore becoming larger, but not necessarily more uniform. The growth of destination malls, experience-led categories and office-linked retail is creating new opportunities, while differences in rents, vacancy, supply and catchment strength are widening the gap between individual markets.

For developers and retailers alike, the next phase of India’s retail growth is likely to be less about adding space and more about getting the right format, location, tenant mix and consumer experience.