High-street rents outpace malls as brands chase visibility

NEW DELHI: High-street retail rents are rising faster than mall leases across India’s top cities, as brands pay a premium for visibility and daily footfall, according to a report released on Monday.

The report, Retail Releap 2026 by Anarock Group, said prime high streets are seeing steady rental growth, while mall rents have remained largely stable, with increases limited to a handful of high-performing grade-A properties. The divergence reflects tight availability in premium malls, pushing retailers to be more selective about store locations even as developers prepare to add fresh supply over the next few years.

“With vacancy levels in premium malls remaining constrained, several brands, particularly across fashion, luxury, and food and beverage, are increasingly turning to high streets as an alternative route to expansion. In many cases, high-street locations are being leveraged to maintain market presence and growth momentum in the absence of available mall inventory," said Anuj Kejriwal, chief executive of retail for Europe, the Middle East and Africa (EMEA) at Anarock Group, a real estate consultant.

Mall operators, however, say leasing remains healthy.

Rajneesh Mahajan, chief executive officer of Inorbit Malls (India) Pvt. Ltd told Mint, this could be due to the absence of mall supply that high street rentals have firmed up. “Mall rentals are growing steadily at 8-9% year-on-year which is healthy. In the last few years, mall rentals have grown steadily on the back of categories like jewellery as well as athleisure and accessory stores,” he said.

Metros driving new retail pockets

A large share of new retail space is expected to come up in Delhi NCR, Mumbai, Pune and Hyderabad, with NCR alone likely to see over 22 million sq. ft by 2031, according to the report. The pipeline signals a shift after years of tight supply.

The same report last year said demand for mall space had outpaced new supply for the third year in a row, keeping vacancies low and rentals under pressure. The latest data suggests developers are now moving to catch up.

For now, demand remains steady. In the second half of 2025, about 4.3 million sq. ft of retail space was leased across the top seven cities, led by apparel brands, followed by food and beverage and entertainment players. Retailers largely preferred mid-sized stores, balancing costs with store performance.

Demand patterns varied across cities. NCR and Mumbai saw more fashion-led leasing, while Hyderabad and Bengaluru saw stronger demand from large anchor stores such as supermarkets and entertainment centres. High streets, meanwhile, continued to draw brands, often offering quicker returns despite higher rents.

Retail space itself is evolving. Malls are increasingly being designed as destinations, with more space going to food, entertainment and large-format stores. Direct-to-consumer brands are also opening more physical stores, adding to demand for organised retail space.

The next phase will depend on how quickly new supply is absorbed. If demand holds, new malls could ease pressure on existing properties. If not, competition for tenants is likely to increase, especially in cities where supply is building up quickly.