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UP's Budaun, Indore, Baroda will see the most growth in malls this year

UP's Budaun, Indore, Baroda will see the most growth in malls this year
  • Cities like Baroda, Budaun, Indore, Nagpur and Udaipur will record a yearly growth of 91% in terms of number of malls, according to Anarock.
  • Consumers in these tier 2 and 3 cities are now purchasing more branded products and, therefore, setting the stage for growth of retail across the country.
  • Among all cities in India, Chennai will see the highest supply of four new malls this year.
India is all set to have more malls and the cities that will see more malls are tier 2 and tier 3 cities like Budaun in Baroda, Indore, Nagpur and Udaipur — with a yearly growth of 91%, according to a report by Anarock.

The major factor behind this growth is the rising consumer demand for branded products in the tier 2 and 3 cities, which sets the stage for accelerated growth of organized retail across the country.

These cities have seen considerable growth in disposable income, mobile internet penetration, and support infrastructure.

“The pandemic-infused e-commerce boom cannot be wished away and continues to be patronized by some segments of society. However, the upcoming supply of mall spaces - clearly in response to increased demand - proves that physical retail remains the dominant force in India,” says the report

Considering the uptick in demand and rising volumes across categories, mall developers are finishing their projects and rapidly adding new inventory in these cities.
15 malls in 12 cities this year
The report further says that around 15 new malls will be built this year across 12 cities in India. This number is twice what it was last year.

Chennai will see the highest supply with four new malls this year spread over an area of 2.55 mn sq. ft, according to the report.

Other tier 1 cities where new malls will be built would be — Ahmedabad, Bangalore, Hyderabad, Mumbai, Pune and Ghaziabad in NCR spanning 5.10 mn sq. ft. area.

"While 2020 was a washout year with new mall supply of just 2.1 million sq. ft. in tier I cities, it nearly doubled to 4.01 million sq. ft in 2021," says Pankaj Renjhen, COO at Anarock Retail.

The Covid-19 pandemic hit most of the sectors in India but brick-and-mortar retail stores in malls and high streets were hit hard the most in which quick recovery seemed to be improbable.

"The performance of most malls in key consumption centres has either surpassed pre-pandemic levels in February 2020 or inched closer to those thresholds,” Renjhen added.

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