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Retail Intelligence I September 2013

India’s Retail Luxury Quotient-

Exploring the Luxury Clusters of India
India’s Strong
Consumption Story
Looking through the changing consumption
basket of Indian consumers

India’s strong consumption story relies on its demographic structure, which, at this
point in time, is highly favourable compared to most other emerging nations. As per
the UN population statistics, this favourable demographic dividend will last for another
25–30 years. Before that, most other emerging nations would have already begun to
witness a slowdown in the growth of young (working-age) population.
The ensuing benefits with regard to the rising income and household spending would
provide a significant boost to the consumption-driven growth story of India. A glimpse
of the changing pattern of India’s consumption is already visible in the breakdown
of private final consumption spending data provided by the government. There is
a marked increase in spending on lifestyle products and services such as hotels,
mobiles, transportation and other miscellaneous goods. As against that, spending on
essentials has only remained stable.
International retailers are well aware of these benefits that the Indian economy offers.
Barring few legislative challenges that could be tackled through the policy reforms and
opening up of the retail sector, retailers have often expressed their intention to enter
and invest in India’s attractive retail sector. This is very well reflected in AT Kearney’s
Global Retail Development Index 2012, where India ranks as the fifth most attractive
retail market for international retailers.

Growth of Young Population

Higher growth of young population to last longer in India
(Growth in working population aged 15-59 %)




55 60 65 70 75 80 85 90 95 00 05 10 15 20 25 30 35 40 45
0 0- 55- 60- 65- 70- 75- 80- 85- 90- 95- 00- 05- 10- 15- 20- 25- 30- 35- 40-
-1 5
19 19 19 19 19 19 19 19 19 19 20 20 20 20 20 20 20 20 20
Brazil China India Russia All figures in (%)

India’s Spending on Essentials (Proportion of

Private Consumption Spending)
Essential spending as a proportion of Private Consumption Spending
8 35

7 30

3 15

1 2000 2002 2004 2006 2008 2010 2012

Healthcare Education Clothes & footwear Food (rhs) All figures in(%)

India’s Spending on Lifestyle (Proportion of

Private Consumption Spending)
Lifestyle spending as a proportion of Private Consumption Spending

Source: UN Population Statistics, India NSSO data, Jones Lang LaSalle Research

to India’s
Retail Sector

The retail sector is a significant contributor to India’s economic activity. Though a India’s Services Sector Breakdown (% of GDP)
direct measurement of the retail sector is difficult to derive through government
statistics, the trade, hotels and restaurant sectors come close to giving us an
estimate of its contribution. That component, in which retail (both organised and 18
unorganised) is the dominant activity, accounts for around 18% of India’s GDP.
Within the services sector of India, this component is the largest contributor 20 16

to the economy. Many institutions, however, may not agree with this possibly
18 14 % of India GDP
understated measurement of the retail sector, as it may not accurately account
for the unorganised sector. For instance, as per the estimates of the Associated 16
Chamber of Commerce and Industry (ASSOCHAM) presented in one of its retail
reports of 2012, the contribution of both organised and unorganised retail stood 14
at 22% of GDP. This would mean that Indian retail sector size should measure
12 8.2
closer to INR 19.2 trillion in 2012. Leading research institutions such as AT
Kearney and ASSOCHAM estimate this sector to grow at around 15% y-o-y over 10
the next three–five years as against a 12%–13% nominal growth of India’s GDP
estimated by the International Monetary Fund (IMF). Going by that logic, the retail 8
sector should reach a size of INR 34 trillion by 2016. This is a significant growth.
The sector is also an important contributor towards the socioeconomic well-being 6
of the economy as it employs close to 9.4% of India’s labour force, as per the 4
In its current form, the retail sector in India is mostly unorganised in its structure,

All figures in (%)

Trade, hotels &

Finance, Insurance,
Real Estate &
Business Services

Community, Social

Transport, Storage
& Communication

& Personal Services

with the organised retail contributing a small 7% to the total sector as of FY2012. 0
However, this industry is witnessing a fast transition and it is estimated that the
organised sector will record a growth rate of close to 24% CAGR to increase its
share to 10.2% of the total sector by 2016–2017, as per ASSOCHAM. As of 2016,
the organised retail sector would therefore touch the size of INR 3.5 trillion.
While both formats compete in almost all categories, the unorganised sector is
largely concentrated around the food and grocery portion, while the organised Industry Estimates Overall Retail Sector to Touch
sector has harped on apparels, accessories and lifestyle goods more than on
groceries. INR 34 Trillion by 2016

Estimated Growth of Organised Retail 40 24

3.5 23
30 34.0
Retail sector (in INR trillions)

Retail / GDP share (%)

29.5 23
16.9 25.7
3 22.3
20 22
INR trillion

2 15
5 21
2011 2012F 2013F 2014F 2015F 2016F 2011 2012F 2013 2014F 2015F 2016F

0 Retail Sector Share in GDP

Source: CSO, ASSOCHAM, AT Kearney, Jones Lang LaSalle Research

Break-up of Organised and Unorganised Retail

7% Food and Grocery
1 3 1
6 4
1 Apparel
8 24 5
Consumer Durables, Mobile & IT
2 4
Home Décor and Furnishing
10 93%
Beauty, Personal and Healthcare

4 Pharmacy
Jewellery, Watches and Eye Care

20 35 Footwear

Books and Music

All figures in (%)

Organised retail (2011-12) Unorganised retail (2011-12)
Source: India NSSO data,
Jones Lang LaSalle Research

Value of Grade A Organised Retail Stock in India

The presence of unorganised retail is spread across all parts of the

country, although organised retail has started to flourish since the early
part of last decade. Within that, most of the investible grade stock of
Grade A category of retail spaces revolves around the larger metros.
Delhi NCR and Mumbai NCR, thus, have been leading in terms of the
cities having the highest concentration of Grade A retail malls, followed
by other top Tier I and Tier II cities.

Source: Jones Lang LaSalle Research


Indian Retail Sector –

SWOT Analysis
Strengths Weaknesses
• Significant contributor to the Indian economy and thus • Highly unorganised sector and thus inefficient; causes drain
important for policymakers on national resources (pilferage of food grains, etc)
• Critical sector in terms of its socioeconomic benefits • Poor infrastructure limits growth and profitability
• Creates livelihood for a large segment of population, both • Regulatory hurdles are high, especially in obtaining mandatory
officially and unofficially multiple retail licenses
• India’s rising urbanisation—urban inhabitants value convenience • Management of supply chain is skewed in favour of few large
shopping wholesalers/retailers
• Disposable income in India is on the rise; helps enhance • Within the organised sector, talented professionals are
consumerism (spend now, save later) difficult to find
• Witnessed high growth rates in the past, while growth outlook is • Real estate cost, particularly in larger cities, acts as a deterrent
also bright
• As yet, the retail sector does not have an industry status,
• Agriculture sector in India is huge, offering abundance of raw which limits its ability to raise financing
• Multiplicity of taxes & taxing bodies coupled with a MRP
• Information technology, which enables cost reduction for retail, is (Maximum Retail Price) regime reduces margins
strong in India

Opportunities Threats
• Increasing awareness of consumers about quality products • Vast unorganised market puts severe downward pressure
and services on industry margins
• Indian retail sector is huge and is therefore seen as an • Ongoing economic slowdown has affected the spending
attractive market by multinational retailers power of consumers to a great extent
• High level of consumerism encourages product innovation • Any move towards modernising the industry is met with
and improved services opposition from wholesale-retail associations
• While leading urban centres in India is rightly served, smaller • Political deadlock between the proreformist parties and the
towns and rural areas are almost untapped left-wing conservative parties could delay necessary reforms
• With a median age of around 26 years, India’s demographic in this sector
dividend story will remain intact for many more years • Reversal of announced policy measures and retrospective
• Government’s effort towards increasing banking penetration clauses in litigation and taxation disputes affect investor
and financial inclusion will further encourage spending sentiments

India Retail:
The Indian retail sector has witnessed unprecedented growth over the last decade, driven by robust economic growth, rapid urbanisation and changing lifestyles and aspirations
of the Indian consumer. From less than 1 million sq ft of mall space in 2001, the Indian organised retail sector has increased manifold. However, the ups and downs of the Indian
economy had always taken its toll with changes in absorption and vacancy over the years.

) (Vacancy Rate)
sq 30
00 Forecast
0 25 After displaying stellar growth, the retail scenario in
1 50
India took a beating during the years after the global
50 20 financial crisis (GFC). It bounced back in 2011 with
the completion of malls that were in the pipeline
00 15 and dropped again with a decrease in supply and net
absorption in 2012. In the coming years, we expect to
0 10 see a moderate inflow of fresh supply of mall space and
a lukewarm demand for malls at poor locations and of
0 5 inferior quality. This is expected to marginally increase
the vacancy in India’s organised retail stock.
0 0
25 2009 2010 2011 2012 2013 2014 2015

0 Completions Net Absorption Vacancy Rate

Source: Jones Lang LaSalle Research, 2Q13

All the seven cities in India, except Mumbai, are likely to

experience increase in the vacancy levels in the midterm
of the coming three years. As demand is likely to be
concentrated in malls in appropriate locations, based
on sound research on cluster and consumer pattern.
We can see the higher change in Hyderabad with more
than 15% increase because of poor performance in the
absorption front. However, Chennai and Delhi—with
a marginal increase—and Mumbai—with a decline in
vacancy rate—could remain the better performers. We
also expect a significant increase in the Delhi NCR stock
in the coming three years and Hyderabad stock getting
nearly doubled in the said time frame.

The forecast value are taken of end-2015 and the present value is of 2Q13
Source: Jones Lang LaSalle Research, 2Q13

1H13 witnessed new

The organised retail stock Net absorption was Present vacancy in
supply, amounting
of India stands at down by 0.3 million Pan-India Grade A
to 90% of the total
67.1 million sq ft, in the sq ft in 1H13 as stock stood at 18.6%
supply of the entire
major seven cities compared to 1H12 at end-2Q13

Future of Indian Retail Present Polarisation in Demand

Key to Success
• Understanding the locational background and its suitability and
potential for upcoming retail brands
• Understanding the consumer needs and wants
• Venturing into locations that are having favourable residential
catchments or are likely to have better retail potential in the long run
• Selecting the correct strategy for operations and growth
• Churning in newer and innovative ideas for potential retail
• Brand awareness campaigns that could help build performance
guideline for the retailers

The organised retail

stock of India is Source: Jones Lang LaSalle
Research, 2Q13
expected to be 87.4
million sq ft as at
end-2015 The existing high vacancy in malls in Mumbai and in Delhi NCR
could also be attributed to the polarisation in the demand for malls
in these cities. The malls that are in good locations and are backed
up by the sustainable consumer community suitable for them are
helping them perform well with large footfalls and good conversion.
Vacancy is likely to Meanwhile, overambitious projects launched in with poor designs
at times coupled with poor locations contribute to higher vacancies
remain unaltered within the vicinity and the rest of the city. Even with the expected
with marginal ups correction in supply in the long run, the vacancy is expected not to
change much as some of these projects are under construction and
and downs around would be operational in the midterm. Another important point to
its present level consider is the lesser availability of lands in the prime city areas for
the development of organised retail

Retail Attractiveness Index

Upper-mid and high residential units launched in last 3 years
Grade A High Street stocks in prominent locations
Grade A quality stocks coming up in next 3 years

Population in the age group 18-45 years

Household with 2 or more employed
% of population in Sec-A & Sec-B

Household Expenditure Pattern

Attractiveness of High Streets

Retail Consciousness Index
Migration in the last 4 years
Retail Attractiveness Index

Propensity to Consume
Market Potential Index

Experimenttaion Index
Grade A quality stocks

Brand Consciousness
Cosmopolitan Index
Real Estate Drivers

Household Income
Prime Retail Rents


NCR Delhi







Jones Lang LaSalle Research and Real Estate Intelligence Service (REIS), 2Q13 (for detailed parameters, refer to Annexure 1)
Delhi NCR high and upper-mid residential units launched in the last three years would be able to
create the retail demand. However, many from Chennai migrate to other IT destinations
Delhi NCR tops most of the parameters on which we base our retail attractiveness
such as Bangalore, Hyderabad and Pune, as indicated by their low migration rates.
quotient. The city tops all real estate drivers and also the sociopsychological
parameters. As a result, Delhi NCR stood first in rank and we can deduce that it has
the most enriching retail legacy among the Indian cities.
The best that Kolkata can offer to retailers is the attractive household expenditure and
Mumbai an illustrious high-street variety retailing. It has a fairly high concentration of SEC A
and SEC B households whose propensity to consume is usually higher than others.
With the highest in-migration and a large number of SEC A and SEC B population,
However, rents in prime areas are not affordable and the retail stock is also low, both of
Mumbai has the highest retail demand potential. However, a lack of availability of
which make penetration of the retailers difficult.
land parcels leading to high rents in prime areas act as a dampener that causes
Mumbai to lag behind Delhi in terms of existing retail stock, and also against other
cities when compared to the upcoming supply. The high propensity to consume
creates an inherent shopping culture, which helps sustain the rise in demand for Hyderabad offers attractiveness in terms of affordable rents, which is higher only to
retailers. Pune among the Tier II cities. In addition, a huge amount of upcoming supply in the
next three years would naturally keep the momentum in consumption alive in the
Bangalore future. However, lesser household income and household expenditure has ranked it
low in our table.
Bangalore ranks high on the chart with its good retail consciousness and the existing
and upcoming supply. In addition, affordable rents in the city—compared to other
Tier I and some Tier II cities—have helped the retail to flourish here. However,
the city has lesser household expenditure even when compared to Kolkata and Pune provides the most affordable rents in prime areas among the Tier I and Tier II
Chennai. cities. The high migration rates will be well supported or even enhanced in the future,
given that the city has a large office supply per capita in the pipeline. However, low
Chennai household income and expenditure compared to most other cities has ranked it the
Chennai, with its affordable rents and good high street stock in contrast to the
organised retail stock, has received the fourth rank. In addition, the large number of

Annexure 1 Indicator and Metrics Used in Creating the Indices

Factor Indicator Metric
Market Potential Index (MPI)

Prime retail rents – Penetration of all the brands depends on the precinct’s rental affordability Average rents of 50% of the malls in the prime areas of the city
along with its high-income availability to continue to the profitability equation. Mature markets (excluding the top 25% and bottom 25%), including the weighted
may tend to fetch higher rents. However, with high supply, the retail rents does not affect much average of vanilla and anchor rents
Real Estate Drivers

Completed quality stocks – Presence of high-quality completed stock shows the extent of Total existing organised retail space
maturity of the market
Upcoming supply is a leading indicator of the extent of maturity expected in the market in the Total organised retail space that is expected to come up by end-2015
coming years
Total high street retail in prominent retail destinations of the city in
High street stocks in prominent locations drive the cities’ market potential terms of shopping clusters and shopping centres
High and upper-mid residential units produce the base for retail catchments in the city as the The total number of residential units in the upper-mid and high
dwellers are more likely to visit the malls and the costlier high street locations categories launched within the last three years
Migration – Migrant population not only adds to the consumer base but is also likely to have People1 who migrated to the city in the last four years

increased its acceptance to organised retail spaces such as malls versus conventional stores

Consumer profile is another deciding factor behind a city’s drive to act attractive towards the
retailers as most of the SEC A and SEC B population are conscious towards the presence of Number of SEC A and SEC B population of the city
Total number of households with income of more than INR 300,000
Households above a certain income threshold are more likely to shop with higher frequency and for SEC A, income more than INR 500,000 for SEC B and income
Propensity to Consume

foot larger bills than households with lesser income more than INR 1,000,000 for SEC C
Expenditure of households with income more than INR 500,000 per
Expenditure of TIG is the decisive factor for propensity to consume annum

Families that have more than one employed member have higher earnings potential.
Moreover, employed members of the household have greater economic freedom in making Number of households with more than two employed members
independent consumption choices

Retail Consciousness Index (RMI)

The young population is more brand conscious and focused towards choosing products based Population in the age group of 18–45 years
on newer trends
Experimentation with practicing newer fashion trends and consciousness towards modern Qualitative understanding of the fashion consciousness of the cities
fashion phenomena creates the base for international brands with better potential for and how they are reacting to the newer trends
Qualitative and subjective understanding of cosmopolitan nature of
A cosmopolitan city is the breeding ground for fashion potential the cities
Qualitative understanding about the performance of the international
Brand consciousness of a city helps the retailers to enter the market and achieve profitability luxury and premium brands and the cities’ consciousness about the
with potential sales these brands that are newer entrants in Indian markets
Attractiveness of high streets of the city helps in building the retail consciousness even if the city Subjective and qualitative understanding of the performance of the
does not have potential Grade A quality organised retail stock high streets in terms of visibility and footfalls
• Preference for shopping malls will be higher in cities where shopping centres have been historically prevalent (e.g., Delhi) versus cities where high street shopping has been
prevalent (Mumbai, Chennai and Hyderabad).
• The consciousness data has been used by qualitative assumptions. However, individual feelings and preference could vary in specific cases.
• The future data and their impact are predicted. However, any change in the market scenario and unforeseen circumstances could change the equation and the process then
calls for a reiteration.

Number of migrants is based on total population because of the unavailability of data of migrants in SEC A population. It is assumed that the SEC A migration rate should be same for these top cities.
Source: 1. Analytics and real estate data are sourced from REIS (Jones Lang LaSalle) 2. Demographic, sociocultural and income data is sourced from Indicus Analytics 2011–2012.

Luxury Retail in India

Exploring New

Key Luxury Retail Clusters in India

At present, India enjoys only 1%–2% of the global luxury market. Luxury retailers,
both national and international, are in a spree to foray or expand their footprint in
India. The increasing foreign travels of Indians have significantly increased the brand
awareness of India. Along with this, the increasing upper-middle class in India are the
country’s key drivers of luxury retail demand. Louis Vuitton, Prada, Gucci and Jimmy
Choo are no more unknown brands to India. In the last decade, luxury retail has grown
significantly and is growing at a rate of almost 20% 1. From luxury cars and apparels
to furnishings, all are paving their way into the choices of Indian consumers. The
definition of luxury is very relative and changes from country to country and among
different income groups. However, most households earning more than INR 1 million
or above annually opt for luxury goods in India. With the significant growth of this
income group, luxury retail in India is expected to witness steady growth in the coming
In India, preference for luxury goods is growing across all the metro cities, although
they are mostly concentrated in Mumbai and Delhi. Luxury malls such as DLF Emporio
in Delhi, Palladium in Mumbai and UB City in Bangalore are already operational.
However, luxury retailers generally open their stores in luxury hotels with increased
preference from consumers as they are expanding their brand presence by starting
their stores in high-end malls and high streets and sometimes opening their flagship
stores in high-end residential neighbourhoods. However, finding a space as per their

standards and specifications is still a challenge in India.
In this paper, we attempted to map a few such clusters across the seven metro cities
in India based on the various qualitative and quantitative factors catering to the
preference for luxury retail. The factors adopted to select the clusters were penetration
of luxury brands and preference for luxury. These factors were analysed on the basis
of the parameters below:
• Presence of noted luxury apparel and accessories brands
• Presence of luxury automobile showrooms
• Presence of fine dining restaurants
• Presence of luxury/premium residential projects
• Neighbourhoods and catchments

When mapped, these parameters reveal clusters of luxury retail that can be classified
into three categories. Based on their stage of development, the clusters are classified
as established, existing, growing and emerging.
The clusters and their characteristics will be discussed on the following pages.

Luxury brands focus

on strong growing
brand consciousness
and the fast growth
of India’s upper-
middle class

DLF Emporio in
Delhi, Palladium
in Mumbai and UB
City in Bangalore
are luxury malls
operational in India.

India’s retail real

estate has to upgrade
its specifications
to meet the global
standards to cater to
the luxury retailers’

1. The Indian Luxury Summit 2012 – Analysing the Indian Luxury Market

Delhi NCR
Accounts for highest SEC A population having income of
more than INR 300,000 pa

Zara, LV,
Audi, BMW, Hi-Design, Cost for two
Mercedes, TAG Heuer, is greater than
Jaguar, Land Jimmy Choo, INR 2,500
Rover, Rolls Paul Smith, (excluding
Royce Emporio beverages)
Armani, Clarks
The featured brands do not make a comprehensive list of all the brands present in the city.

West Delhi
3 5 12
Rajouri Garden, Shivaji Garden, Rohini, Pitampura, Kirti
Central Delhi
Connaught Place (Inner and Outer Circle)
2 3 27
Prime South
Vasant Kunj, Saket, Greater Kailash, Khan Market, South
Extension, Lajpat nagar
1 14 98 NOIDA
NOIDA (Sectors 15-18), City Center
1 1 8
MG Road, Golf Course Road, Mehearouli Road, Delhi
Gurgaon Expressway

5 6 36 Extended Gurgaon
NH8, Dwarka Expressway
2 6 32



Being the oldest and one of the largest commercial, No malls are present here, with high street The unavailability of retail space is a concern.
financial and business centres in Delhi, the location shopping the dominant retail format. Despite However, the demand looks bright in the cluster
Central Delhi enjoys heavy footfalls which spur the retail sector.
The presence of foreign bank branches, clothes
absence of high-end residential, this area is
preferred by shoppers spread across the breadth
with huge footfalls each day.

(Established) and accessories, F&B and luxury car outlets is of Delhi. As a result, the demand from retailers has
evidence of the retail potential of this developed pushed the retail rents to INR 400-500 per sq ft per
cluster. month.
A well-established area characterised by upper-mid No luxury residential units have come up in the The future outlook is impacted by the presence of
and high-segment business families and private past three years, but demand for organized retail a dominant high street shopping culture, though
West Delhi builder floors which has added to the attractiveness has been driven by the existing SEC A population.
of this location. This is evidenced by the presence of more than ten
recent developments have shown that the correct
mall design and management can reap the benefits
(Established) operational malls and another five projects under of excellent tenant profile and healthy footfalls.
development. The retail rents are in the range of
INR 150-200 per sq ft per month.

Being home to the urban elite , this location has More than 250 luxury residential units had been The future of the cluster’s retail looks good with its
seen demand for luxury retail with a push towards launched in the last three years, which reciprocated positioning as the city’s luxury retail focal point.
international brands and luxury cars. the growth in spite of land shortage. Large numbers
of foreign bank branches are also present to
Prime South cater for the high net worth individuals (HNWI)
population. Five midsized to large-sized malls are
(Established) present, including the luxury mall DLF Emporio.
However, there is a shortage of supply in the
pipeline. Retail rents are within the range of INR
250–INR 300 per sq ft per month.
NOIDA city and its city centre are acting as the At present, NOIDA has five mid to large size The cluster is growing fast and could observe
major hub of the new age industries, which malls with two upcoming malls in pipeline. The retail sector development coming up of age as it is
NOIDA includes IT/ITES sector and are also catering to the demand is supported by more than 4,000 high-end supported by the high-end population.
demand of modern urban elites. residential units launched in the last three years.
(Growing) The rental range is between INR 150-175 per sq ft
per month.

Gurgaon is developing rapidly. Commercial sector More than 3,000 high-end residential units were The cluster’s future is bright with the development
development, complemented by the residential launched in the last three years. The retail demand of new age commercials. It is also supported by
sector’s growth and proximity to the airport, is has been supported by six midsized to large-sized residential growth, which drives a sustained retail
Gurgaon helping the cluster grow. malls. The presence of foreign banks and luxury demand in the long run.
car showrooms are also being driven by the real
(Growing) estate growth. Consumer demand has pushed the
cluster’s retail rent to INR 175–INR 200 per sq ft
per month.
It is one of the upcoming locations that is This cluster witnessed the launching of more than The residential sector could boost the cluster’s
Extended Gurgaon connected very well with Dwarka Expressway and 5,000 high-end residential units in the last three retail demand that will likely open up new
NH8 years, which created a base for huge consumer possibilities and opportunities.
(Emerging) demand.

Mumbai MMR
Amidst many retail clusters, retailers can still find
opportunities by location & densification

Zara, LV, Hi-

Audi, BMW, Design, Tag Cost for two
Mercedes, Heuer, Jimmy is greater than
Jaguar, Land Choo, Paul INR 2,500
Rover, Rolls Smith, Em- (excluding
Royce porio Armani, beverages)
The featured brands do not make a comprehensive list of all the brands present in the city.

0 1 1
Ram Marooti Road, Ghodbunder Road

Malad Kandivali & Borivali

0 2 3
Andheri WEST
Lokhandwala Complex, Link Road
3 0 5 Andheri Kurla Road- Powai
Hiranandani Powai, International Airport Terminal & Vicinity
3 1 40
Bandra WEST- Juhu
Linking Road, Juhu Tara Road
0 2 36


LBS Marg

3 1 5
Vashi Node, Seawoods Node

6 7 18 Worli- Lower Parel

Annie Besant Road, High Street Phoenix

2 6 32
Colaba Causeway, Fort



This is the oldest and among the largest This cluster has only one accessible mall at Unavailability of retail space is one of its prime
Churchgate-Colaba commercial, financial and business centres in Nariman Point, although it is known to house concerns. However, the cluster’s demand is high
Mumbai. The cluster has a high level of commercial popular high-street markets such as Colaba with huge footfalls every day.
(Established) activity and tourism because of its huge footfalls. Causeway and Fort.
This cluster is illustrious in terms of consumption There is no mall within this vicinity, although it Demand is very high, but space availability, high
parameters—particularly fine-dining—and receives houses popular high streets and small shopping rentals and competition from high streets could be
Bandra West - Juhu high footfalls from its neighbouring high-end arcades. Rentals in this cluster are very high and of concern for mall developers.
(Established) residential households and avid shoppers. space availability for constructing large malls is

This cluster is home to the elite residential There are four good malls and a prominent high There is scope for further retail development,
households of Mumbai. It also houses large-scale street in the vicinity. It houses Mumbai’s only luxury although the availability of space and high rentals
Worli-Lower Parel commercial buildings that help to attract footfalls retail mall—Palladium. Rentals are high, owing to would remain a challenge.
from the high-consuming class. It scores very high its strategic location.
(Established) on all consumption parameters.

With the upcoming completion of Mumbai’s This cluster has witnessed Mumbai’s highest Retail high streets in Powai have already picked
first metro, there is an ample commercial and completions of high-end residential units during up well and there is a scope for this cluster to
Andheri Kurla residential activity happening around this cluster as 2010–2012. Also, in terms of upcoming completions accommodate a large-sized mall.
it is easily one of Mumbai’s most important east– (2013–2015), it ranks the third highest. The cluster
Road- Powai west traffic corridors. has no mall and consumers rely on high streets.
(Growing) Consumers have access to R-city, Phoenix and few
other malls, but with some difficulty.

This cluster, which has been part of the western It houses approximately four to five malls nearby The future of retail in the cluster looks good with its
suburbs, houses the largest number of Mumbai’s and it also boasts of a prominent high street around positioning as the city’s luxury retail focal point.
Andheri West SEC A households. Additionally, it houses several Lokhandwala Complex. While a couple of malls
commercial establishments, thereby creating ample receive very good footfalls, others are struggling
(Growing) footfalls. to attract consumers because of poor mall
management. Rentals are high..
Having several large-format malls and other Among all the clusters in Mumbai, this has While it is a growing retail cluster, the presence of
Vashi-Nerul sources of entertainment, this cluster is a shoppers’ witnessed the second highest completions of high-
paradise in Navi Mumbai. end residences in the last three years. Mall culture
prominent malls nearby will have to be examined.
Identifying the right location will be very important.
(Emerging) among households is high as the cluster lacks high Cheaper rentals would likely attract developers
BKC is already been viewed as the emerging CBD Commercial activity is strong in the vicinity. The The cluster will witness ample demand going
of Mumbai. Presence of several large financial cluster will witness large number of completions forward. However, developers will have to strike
BKC-Kurla West institutions and pharma companies amongst others
ensures high footfalls and is looking to be the most
of high-end residential units while it already
is emerging gradually on the consumption
a balance with high rentals it commands. With
successful operation of malls such as Phoenix
(Emerging) premium office destinations. The spillover effect of parameters. There is 1 mall in the vicinity and it Market City in Kurla W, we believe it has potential
BKC has been felt on Kurla West as well, which is enjoys reasonably good footfalls. to grow. In addition, F&B and automobile sector are
developing rapidly. looking to be easy entrants among others.
This cluster has come to prominence due to its Residential activity has picked-up steam over last Despite 2-3 prominent malls in the neighborhood,
good road & rail connectivity to major commercial few years. By 2015, this cluster would witness we believe there is ample scope for further
Malad-Kandivli- destinations and to South Mumbai. In recent times, second highest completions of high-end residential development of retail considering the population
Borivli it has shed its image of a cluster inhabited by lower units. We also foresee gradual emergence of size and growth. An upcoming mall, should receive
or middle-income population. Our consumption commercial activity which would help enhance positive interest from retailers, also considering its
(Emerging) parameters suggests gradual pick-up in demand retail footfalls. relatively low rentals.
for retailers
An erstwhile hub of lower and middle-income This cluster has become the hotbed of residential Affordable rentals and availability of space, coupled
Thane population, Thane has lately completely construction activity due to its affordability and vast
transformed into a self-sufficient city, barring major expanse of unutilized land towards the interior.
with rising population and incomes will be the key
trigger to further development of retail activity in
(Emerging) commercial activity. Many high-street and malls has this cluster.
kept the retail activity bustling.
This cluster has seen a large influx of population Although starting to pick-up, property prices are Due to large-scale residential development, there is
from erstwhile affordable residential corridors of relatively reasonable. There is no prominent scope for retailers to tap the potential consumption.
Vasai-Virar Mumbai as well as new migrant population who
could not afford a house in Mumbai. Therefore,
Grade-A malls in this cluster, and shoppers usually
frequent to high-streets and stand-alone stores to
Few branded outlets have already started to foray
into some of the high-streets. However, organized
(Futuristic) while the inherent population is largely middle-class cater to their consumption needs. retail in the form of malls could be some time away.
or lower, the new influx of population is largely
higher consuming class.

Luxury retail driven by IT development in the city

Zara, LV,
Audi, BMW, Cost for two
Mercedes, is greater than
Tag Heuer,
Jaguar, Land INR 2,500
Jimmy Choo,
Rover, Rolls (excluding
Paul Smith,
Royce beverages)
Armani, Clarks
The featured brands do not make a comprehensive list of all the brands present in the city.

North Bangalore
0 4 10
Malleshwaram, Yeshvantpur, Bellary Road, Hebbal,
Hennuru, HSBR Layout
East Bangalore
0 4 9
Old Madras Road Whitefield Road, White field

Central Bangalore
MG Road, Commercial Street, Cunningham Road, Brigade
Road, Vittal Mallya Road
South and South West Bangalore
Bannerghatta Road, Sarjapur Road, Hosur Road, Outer
Ring Road, Electronic City
0 8 24

5 0 8



As Bangalore‘s CBD, the cluster houses the This location hosts Bangalore’s most prominent malls—UB City, As there is less scope for new development,
city’s major banks, hotels and offices. This Leela Galleria, Garuda Mall and Forum 2 to name a few. It also the supply of quality retail space is restricted.
location is also lined by many premium and has a few prime high streets that house local as well as national However, good footfalls in this location will be
Central Bangalore luxury national and international retail brands and international brands. This location enjoys good demand the key attraction to drive the retailer demand.
and therefore experiences large volume of from retailers, but the availability of quality retail space is a
(Established) footfalls. challenge. As a result, the retail rents to INR 90–INR 150 per sq
ft per month on the high streets and INR 200–INR 250 per sq ft
per month in the malls.
Most preferred IT and residential suburbs of This location is saturated with good malls such as The Forum Quality malls continue to be developed in the
Bangalore. Good connectivity and availability Value Mall, Inorbit Mall, The Park Square Mall and Phoenix area. Development of office spaces and high
East Bangalore of social infrastructure attracted overall
development and it has luxury residential
Market City Mall. This location enjoys good demand from
retailers due surrounding catchment of IT employees and retail
end residential projects in this location will
drive luxury retailer demand.
(Growing) projects, prime hotels and malls. It witnesses rents to INR 40-60 per sq ft per month on the high streets INR
strong demand for retail due to the rising 150-200 per sq ft per month in the malls.
population of IT employees.
It is fast emerging as the next business This location has Orion Mall, Market City West, Vaishnavi Mall, There is large scope for new development
destination of the city with development Golden Grand Mall and Esteem Mall. This location also has few in this location. There are few good malls
North Bangalore of business parks. This is also surging the prominent high streets with good brand presence. This location expected to be operational in this sub-market.
development of high end and premium is fast growing and so it enjoys good demand. Retail rents to Development of office spaces and residential
(Emerging) housing in this location. Consequently retail INR 50-70 per sq ft per month on the high streets and INR 150- projects in this cluster will be the key attraction
developments are also coming up. 200 per sq ft per month in the malls. to drive the retailer demand.
This is an emerging business destination that This location has one of the prominent malls of Bangalore—The It has a large scope for new development.
connects the central city to the Electronic City. Forum Mall—along with Garuda Swagath, BB Mall, Gopalan It has a few malls under construction. The
South and South Good connectivity spurred the development Signature, Unitech Mall, Total Mall, SJR Spectrum and Soul development of office and residential sites
of office and residential developments in Space Spirit. This location is enjoying good demand and along Bannerghatta Road, Hosur Road and
West Bangalore this location. These developments led to the retail rents of INR 70–INR 90 per sq ft per month on the high Sarjapur, together with Electronic City will be
(Emerging) construction of high streets and malls. streets and INR 80–INR 150 per sq ft per month in the malls. the key attraction to drive the cluster’s retailer
In addition, rapid population growth and ease in travel has demand.
increased the catchment reach.

Well-known as one of the cities with best in-class high street
retail destinations

Zara, LV,
Audi, BMW, Cost for two
Mercedes, is greater than
Tag Heuer,
Porsche, INR 1,500
Jaguar, Land (excluding
Bottega Veneta,
Rover beverages)
Starmark, Paul
Smith, Clarks
The featured brands do not make a comprehensive list of all the brands present in the city.

T Nagar
1 0 16
Usman Road, Ranganathan Road, Pondy Bazaar

1 6 25
High Road, KNK Road

SP Road, LB Road, Gandhi Nagar
0 1 0

0 0 6
Velachery Bypass, Velachery Main Road, Taramani Road

GST Road
Tambaram, Chrompet, Pallavaram
2 0 7



The cluster only comprises high street destinations that High street retail is the talk of the town for this cluster. The age-old The absence of new supply is
T Nagar produce an optimum mix of all categories of retailers,
including value, lifestyle and luxury. It could be identified
presence of this cluster and its fame attract consumers well beyond
Chennai; therefore, this cluster does not rely on the neighbourhood
a concern. As a result, large
footfalls could lead to higher
(Established) as one of the highest grossing high streets in the country residential catchment. Its consumer demand and absence of space rents in the existing areas.
with very good connectivity through rail and road. pushed the rent to the range of INR 120–250 per sq ft per month.
This is another well-known location in the city that is It is one of the prime residential locations in the city with an increasing The potential for retail growth
Nungambakkam surrounded with MNC and government offices and
foreign consulates. It is also one of the oldest locations
retail demand and growing space crunch. Bergamo Mall, the hub of
luxury retail destination, is present here amid a number of small and
is high and the only concern is
retail space shortage.
(Established) with good rail and road connectivity. midsized shopping centres and high street retail destinations. The
rents are within the range of INR 120–INR 250 per sq ft per month.
A posh and upscale upper-mid and high segment SEC The high street retail is primarily supported by the neighbourhood We expect the area to attract
Adyar A residential destination and another prime location
for high street retail, the location also boasts of good
catchments who reside in the high-end properties developed few
years ago. This location does not have a mall as high streets cater
more luxury and high value
retailers amid the presence of
(Established) connectivity to the other parts of the city, which attract the retail demand. The retail rents are within the range of INR 90–INR both consumers and affordable
consumers from across the city. 150 per sq ft per month. quality space
Another residential area in Chennai, its growth could be Velachery and its neighbourhoods witnessed the launch of more than The retail outlook of Velachery
attributed to the growth in the city’s IT/ITES industry with 500 high-end residential units in the last three years. This location looks promising with the growth
Velachery its strategic advantage in location and connectivity to saw two malls opening up this year including Phoenix High Street, of commercial sectors in the
OMR and the central city. the largest mall in Chennai. It also possesses good high-street vicinity of OMR.
(Growing) destinations. The rents are within the range of INR 75–INR 110 per
sq ft per month.
It is one of the upcoming locations very well connected The emergence of IT along with other industries and the established With more upcoming organised
GST Road with roads and a proposed metro. In addition, a number
of star hotels have come up in the area and it is shifting
residential catchment both support the high street retail. While the
presence of an airport has drawn luxury car showrooms, lower rents
and quality retail space, the
demand is complemented by
(Emerging) toward organised retail. of INR 30–INR 60 per sq ft per month supports the retail activity in residential growth in the upper-
this emerging location. mid segment.

Amidst demand-supply imbalances between various clusters
in Pune, the city can offer good retailing opportunities

Zara, LV,
Cost for two
Audi, BMW, Rolex, Tag
is greater than
Mercedes, Heuer, Diesel,
INR 1,500
Jaguar, Land Boggi Milano,
Rover, Renault Timberland,

The featured brands do not make a comprehensive list of all the brands present in the city.

3 0 10
DP Road, Baner Road

FC Road & JM Road

0 2 5
FC Road, JM Road, Deccan

Koregaon Park- Bund Garden

North Main Road, Bund Garden Road
3 1 33

MG Road & Camp

3 1 6  MG Road, East Street

Kharadi- Hadapsar
0 1 21
Magarpatta Road

0 1 22 Nagar Road- Kalyani Nagar

Nagar Road



This cluster is located in the heart of the city and is There is limited presence of organized retail apart from High rentals and unavailability of land
an established residential corridor, mostly of high-end high-streets where footfalls are high. Availability of land acts as a deterrent for retailers, who have
Koregaon Park- households. Commercial activity co-exist thereby is scarce for further retail development. Rentals in high to focus on existing high-street locations
Bund Garden Road ensuring high footfall. The cluster scores high on street are high. for making an entry. However, demand
consumption parameters making it preferable for continues to remain high in this cluster
(Established) retailers. from boutiques and F&B.

FC Road-JM This cluster houses a large number of SEC A This cluster has supply constraints. However it has Demand will continue to remain high and
households and also has large student population that prominent high-streets for retail. Rentals are high so will the rentals
Road-SB Road creates demand for a variety of retail outlets. It has a considering limited scope for new retail space to arrive. 
(Established) concentration of commercial space too.

This is an old residential and commercial establishment The cluster has two malls. One of them enjoys good Demand is very high. Availability of
MG Road-Camp- near the Pune railway station. The footfalls in the cluster footfall, low vacancy levels and high rentals. It has high space, high rentals and competition from
Dhole Patil Road are high. It scores high on consumption parameters as
streets, although the demand for organised retail could
be higher.
high streets could be a concern for mall
This cluster boasts of upper-mid and high-end residential The cluster has two existing malls which mostly receive This cluster is promising looking at the
households and continues to pick-up as a residential good footfalls. Amid the scope for future development of gradual rise in consumption parameters.
Kharadi-Hadapsar destination. Commercial activity too is high. retail, preference for location and quality of retail space It is likely to witness to large supply of
remains the key parameters to be carefully considered. high-end residences in next 2-3 years.
(Growing) The cluster scores high on consumption parameters
which indicates rising demand and growing affluence.
Residential growth picking up on the back of large The cluster has three existing malls with good footfalls. Large supply of high-end residences
Nagar Road- number of upper-mid and high-end residential Amid the scope for future development of retail, in next 2-3 years is promising for this
households high commercial activity acts advantageous preference for location and quality of retail space remains cluster with gradual rise in consumption
Kalyani Nagar for the location. the key parameters to be carefully considered. High parameters
(Growing) consumption parameters indicating the rising demand and
growing affluence talks about the cluster
Until recently, the cluster was not ready for retailers There are supply constraint of malls as of now, but there The scope for retailers is high. As
Aundh-Baner or mall culture. However, with the recent increased is one mall under construction. Demand is gradually the demand is strong, availability of
penetration of commercial IT and high-end residential, gaining strength and availability of space may not be space is not an issue and rentals are
(Emerging) the demand for retailers is growing. much of an issue at this point. comparatively reasonable.

Southern India’s hub for Luxury cars

Zara, LV,
Audi, BMW, Hi-Design, Tag Cost for 2 is
Mercedes, Heuer, Jimmy greater than
Jaguar, Land Choo, Paul INR 1,500
Rover, Rolls Smith, Emporio (excluding
Royce Armani, Clark, beverages)
The featured brands do not make a comprehensive list of all the brands present in the city.

Western Hyderabad
1 4 5
Hitec City, Kondapur, Kukatpally, Gachibowli
Off Central Hyderabad
5 6 14
Banjara Hills Road No 1, 2, 3, 10 and 12, Jubilee Hills
Road No 36 and 45

4 1 9
Central Hyderabad
SP Road, Begumpet, Punjagutta, Somajiguda, Nagarjuna
Circle, Secunderabad, Himayat Nagar
North Hyderabad
Vikrampuri, Tirumulgiri, Kompally, Dr. A S Rao Nagar

South East Central Hyderabad

Dilshuk Nagar, LB Nagar



The central business district of Hyderabad, This location is mostly dominated by high street and has malls As there is less scope for new development
it houses major banks, hotels and offices such as Hyderabad Central. Prime high streets which house the supply of quality retail space is restricted.
Central Hyderabad of the city. This location is also lined by
many premium and luxury, national and
local as well as national and international brands are Begumpet,
Somajiguda and Himayat Nagar. This location enjoys good demand
However good footfalls in this location will
be the key attraction to drive the retailer
(Established) international retail brands and therefore it from retailers however as availability of quality retail space is a demand
experiences large volume of footfalls. challenge. As a result, the retail rents to INR 100-150 per sq ft per
month on the high streets.
It is fast emerging retail destination as it has This location has Inorbit Mall. Many prominent malls such as There is large scope for new development
an established IT business development in Forum Crystal, Manjeera Trinity, City Capitol and SLN Terminus in this location. There are few good malls
the cluster. Most preferred IT and residential are under construction in this cluster. This location is also emerging expected to be operational in this sub-
West Hyderabad suburbs of Hyderabad. Good connectivity
and availability of social infrastructure
as prominent high streets with good brand presence. This location
is fast growing and so it enjoys good demand. Retail rents to INR
market. Development of office spaces and
residential projects in this cluster will be the
(Growing) attracted overall development and it has 120-150 per sq ft per month in a mall while high street rent is key attraction to drive the retailer demand.
luxury residential projects, prime hotels and about INR 110-130 per sq ft per month.
malls. It witnesses strong demand for retail
due to the rising population of IT employees.
Premium residential location of Hyderabad. This location has the GVK One Mall and it houses many premium There is scope of development as many
It houses luxury residential projects, prime and luxury national and international brands the high streets of this residential streets are being redeveloped as
Off Central hotels and malls. It connects the central location houses designer boutiques and Premium lifestyle stores. commercial properties. These developments
Hyderabad part of Hyderabad with the IT hub of the This location enjoys good demand from retailers due surrounding along with development of high end
city- Hitec city. Therefore it witnesses office catchment and retail rents to INR 110-150 per sq ft per month on residential projects will drive luxury retailer
(Growing) and retail developments along its key high the high streets and INR 150-175 per sq ft per month in malls for demand in this cluster.
streets vanilla outlets.
This cluster is experiencing more of high Predominantly high street development. Mall supply is a concern There is large scope of development.
street retail activity. Mostly houses upper in this cluster. Rents in this cluster range in between INR 80-100 Development of villas are expected to drive
North Hyderabad middle class population. This location
has the cantonment area and also many
per sq ft on the high streets for good quality properties. demand in this clusters

(Emerging) residential colonies. Therefore it witnesses

good demand for retail. Many brands have
their factory outlets in this clusters.
This cluster is experiencing more of high Predominantly high street development. Prajay Princeton Mall There is large scope of development in this
South Central street retail activity. Mostly houses upper is operational in this cluster. However, mall supply remains a cluster as there are many new residential
middle class and middle class population. concern in this cluster. Rents in this cluster range in between INR projects coming up in this cluster.
Hyderabad This location has many old residential 80-100 per sq ft on the high streets for good quality properties
(Emerging) colonies. Therefore it witnesses good
demand for retail.

The third most populous city in India with a very high
disposable income

Hi-Design, Cost for two
Audi, BMW,
Omega, Rolex, is greater than
Michael INR 1,500
Jaguar, Land
Kors*, Gucci*, (excluding
Rover, Porsche*
Emporio beverages)
*expected to be operational by end-2013
The featured brands do not make a comprehensive list of all the brands present in the city.

North-East KOLKATA
0 0 20
Salt Lake, Kankurgachi, VIP Road, New Town Action Area-
II, Ultadanga, Jessore Road

Prime Central
3 7 39 Esplanade, Chowringhee, Park Street, Park Circus, Camac
Street, Shakespeare Sarani, Elgin Road, AJC Bose Road

EM Bypass & Connectors

3 0 6

Topsia, Kasba, EM Bypass Central stretch

Prime South

0 1 19 Ballygunge, Gariahat, Dhakuria, Prince Anwar Shah Road



As one of the oldest part of Kolkata, it is well supported With the presence of Alipore (most premium residential The absence of quality future stock in
not only by the existing office sector—which accounts location of Kolkata) in the vicinity, more than 200 high-end the long run is the prime concern with
for corporate headquarters, BFSI industries and other residential units were launched in the last three years. the prediction of robust growth in luxury
regional offices—but also by residential units as it is the Aside from high street retail as its most prominent feature, retailing.
Prime Central home of most of the corporate executives and HNWIs. Kolkata’s popularity is also boosted by the presence
of the prime malls Forum and Forum Courtyard and is
(Established) expected to house Quest, a large luxury mall that will be
operational by end-2013. Meanwhile, foreign banks’ main
offices and a number of luxury car showroom talks about
the retail demand. The high street rents could be in the
range of INR 275–INR 400 per sq ft per month.
The existing posh and upscale Salt Lake and : With more than 200 high-end residential sites, residential The long-term retail growth prospect
North-East Kankurgachi neighbourhood and the upper-mid growth through the plotted developments is booming. The seems good as more residential
residences in the nearby areas along the vicinity of the location is seen to grow with the presence of four malls developments are catching up with the IT/
Kolkata PBDs as well as good connectivity through road and alongside other high street destinations. The rents are ITES industry growth in the city’s PBDs.
(Growing) suburban rail with the suburbs help sustain the location’s within the range of INR120–INR 200 per sq ft per month
growth to a longer term.
The cluster is one of the city’s developed retail locations More than 200 high-end residential units had been The absence of new organised mall
with the presence of Gariahat as one of the most launched in the last three years, which reciprocates the stock is the prime concern amid the huge
Prime South prominent value high street designation alongside the
high-end residential neighbourhoods of south Kolkata,
growth in the location with the presence of South City
Mall, the largest and one of the best performing malls
potential of luxury and lifestyle retail
(Growing) which is connected well to other parts. in the eastern India. It has the optimum mix of small to
midsized malls and prominent high street districts. The
rents are INR 175–INR 225 per sq ft per month.
The presence of EM Bypass and its proximity to the More than 550 high-end residential units were launched With the provision of developable land, it
EM Bypass & Prime Central and Prime South clusters at different point in the last three years, making it one of the most active could develop as it is backed up by the
with easy connectivity to PBDs and CBD are the cluster’s residential destinations. With one upcoming mall and a growing high-end residential catchment.
Connectors attractive factors. few under proposal, it could be the next hotspot in the city,
(Emerging) with the present rents ranging INR 150–INR 200 per sq ft
per month.

FDI in India
and Luxury

FDI in cash and • International luxury retail in India is still new

1997–2005 carry allowed in
• Most of the retailers adopted either franchising or joint venture routes
• Ermenegildo Zegna, Louis Vuitton, Hugo and Chanel entered India

2006 – FDI of up to 51%

were allowed with • More than 50 global brands set foot for India foray, which included
prior government prominent luxury brands such as Hermes, Gucci, Dior, Fendi,
approval in single Canali, Burberry, Emporio Armani, Jimmy Choo
brand retail • Franchising, joint venture and distribution arrangements continued

2006–2010 2008 – Government

to remain the entry strategies for retailers
• DLF Emporio and UB City, the first luxury malls in India, started
had discussion on operations in 2008
allowing 100% FDI
• Retailers focused mostly on Delhi, Mumbai and Bangalore to open
in single brand their stores
retail and 51% FDI in
multibrand retail

• Tumi, Bally, Armani Junior, van Laack, Roberto Cavalli, etc opened
2012 – Government stores in India
raised FDI cap • Many luxury retailers continue in joint venture formats because of the

2011–2012 over single

brand retail and
expertise of their local partners
• Luxury retailers were optimising store sizes because of significant
allowed 51% FDI in increase in rents
multibrand retail • Rents for luxury stores increased significantly because of the lack of
available quality space

2013 – Government • INR 8.5 billion proposals were cleared by the government in single
relaxed the clause branded retail until April 2013
of 30% of products • French fashion brand Promod, France-based crockery maker Le
to be sourced Creuset, US-based accessories firm Fossil, Inc and French sports

2013... locally and

allowing retailers
giant Decathlon have sent proposals to the Foreign Investment
Promotion Board (FIPB) for approvals to open single branded stores
• Japanese retailer Uniqlo and Sweden’s and France’s Richemont are
to set up stores
planning to enter India
in cities with less
• Availability of quality real estate to accommodate the requirements of
than a million of luxury retailers is still a challenge
The Road Ahead
Demand–supply Gap to be narrowed hotspot. Early movers will enjoy the advantage of leasing space at
cheaper rentals, although not before a thorough profiling of the cluster
With rising incomes, better education and young-age by their side, Indian demographics is done. Analysis of cluster-level data on population
consumers have emerged as a force to reckon with in terms of their potential characteristics, future commercial developments, upcoming residential
spending power. Mature domestic brands and many popular global brands units, etc has become increasingly important for the retailer to decide
have already made forays into the country, with many more waiting for their on a location.
first tranche of investment. Although the future of luxury retail in India is
promising because of these aspects, it has its own challenges. In addition Policy Support
to this, the availability of retail spaces that are on par with global standards Clarity on FDI policy remains as a key concern. However, in recent
is another challenge. This challenge can be addressed by developers who times, the erstwhile reluctance for government reforms is gradually
have to focus on building strategically in terms of location and design of the transforming, considering the difficult investment scenario that the
property. Retailers are aggressive in their expansion plans, albeit cautious global retailers has been highlighting. The bigger challenge, however,
about property selection. They are not only looking for properties that suit remains in getting the Indian polity’s approval and achieving majority
their operations and costs, but also their customers in terms of the location, consensus. Until that time, such concessions are likely to remain on
facilities and overall shopping experience. They are focusing on the quality paper. Retailers are likely to seek more clarifications and concessions;
of the malls, along with the mall management, tenant profile, etc, all of which therefore, real ground activity on FDI inflows in retail is likely to be slow
are acting as factors responsible for the success of the malls. for the meantime.
Opportunities in the Emerging Cities and Locations
Most Tier I and Tier II cities are bursting at the seams, with more upper
income and middle income consumers penetrating deeper into suburbs
where organised retail opportunities are presently limited. The saturation of
established retail markets closer to the prime city centres is a compelling
factor for developers and retailers to focus on this emerging consumption
Jones Lang LaSalle Asia Pacific

Asia Pacific
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Jones Lang LaSalle Retail contacts in India

Shubhranshu Pani Pankaj Renjhen
+91 98205 19899 +91 98992 18885

For more information about Research contact

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Head, Research and REIS
+91 98211 07054

Sujash Bera Suvishesh Valsan Trivita Roy
Assistant Manager, Research and REIS Assistant Vice President, Research and REIS Assistant Vice President, Research and REIS

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COPYRIGHT @ JONES LANG LASALLE 2013. All rights reserved. The content of this publication has been compiled from the various sources acknowledged. The information is from
sources we deem reliable; however, no representation or warranty is made to the accuracy thereof. This report has been produced solely as a general guide and does not constitute
advice. We stress that forecasting is a problematical exercise which at best should be regarded as an indicative assessment of possibilities rather than absolute certainties.