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The commercial real estate services and investments provider expects that the country’s strong macro fundamentals and the real estate sector’s resilience will help it sustain its growth trajectory, global headwinds notwithstanding.
India’s retail sector saw triple-digit annual growth in both leasing activity and supply addition in Q1 2023, and a further strengthening of the sector’s growth metrics is expected.
Third-party logistics continued to drive leasing momentum during the quarter even as demand from e-commerce improved. The entry of quality supply will ensure the sector’s resilience to macro-economic uncertainty, it said in its ‘India Market Monitor Q1 2023’ report.
Sustained investment inflows are expected in the sector this year, although recessionary forces in key developed economies might slow the pace of decision-making, CBRE noted.
Mumbai, followed by Delhi National Capital Region and Bengaluru, accounted for a cumulative share of nearly 30 per cent in investment inflows in Q1 2023 in the sector.
Retail supply this year is expected surpass 2022 levels owing to pent-up supply addition. Several investment-grade projects launched in the past two years are also set to become operational in 2023. This would give a fillip to primary leasing, which is likely to be the main demand driver for retail space demand this year, the CBRE report said.
Retailers in India will look beyond traditional malls and high streets to diversify their location strategies that will facilitate supply chain transformation so that consumers can shop for any product, any time. Use of metaverse and social commerce will emerge as key omni-channel strategies, CBRE forecast.
Indian retailers are likely to continue to 'rightsize' stores not only to engage customers, but also to provide a wide range of choices in stores, it added.
Fibre2Fashion News Desk (DS)