India’s high streets score over shopping malls with charm, cost benefits & more

• Shopping malls attract top-end and international retailers but high streets rank better when it comes to cost and efficiency.
  
• High streets have built a large base of loyal customers over time, and also attract more serious shoppers rather than the ‘popcorn crowd’ of the malls.
  
• While high streets tend to house more mom-and-pop stores and Indian retailers, Brigade Road, Indiranagar, Colaba Causeway, Connaught Place and Khan Market are exceptions.
  

India’s bazaars and markets that have existed for decades have survived the closures of the pandemic, the rise of e-commerce and also the glitter of large shopping malls.

These shopping streets or highstreets as a Knight Frank report calls them, are spread across 13.2 million square feet across 4,875 retail stores in India’s top eight markets. The report also estimates potential consumption in high streets to touch nearly $2 billion in FY24.

Shopping malls have long overtaken high streets in terms of volume and modern retail, which is high-end branded stores. The total modern retail arena stock on Indian high streets is merely 6% of the shopping malls’ gross leasable space across the top eight markets. But high streets rank higher where it counts — efficiency.

“In terms of efficiency, high streets offer 100% efficiency due to low maintenance costs, whereas in the case of shopping malls, the efficiency can range anywhere between 50-60% depending on the grade of the shopping mall. This is largely due to high maintenance costs for common areas, central air conditioning and escalators,” the Knight Frank report said.

High streets on revival mode

In addition to the charm and being situated in popular locations, high streets are also evolving from their dusty avatars, which will only increase their footfalls even as they cater to the loyal customer base that they have built over the years.

“As cities in India are modernising, we see many high streets in the country reviving as facilities like access, parking, store visibility etc. have improved. Our estimations say that the average per square metre revenues of high streets will be significantly higher than those of malls in FY 2023–24,” said Shishir Baijal, chairman and managing director at Knight Frank India.

The potential consumption in FY24 for shopping malls as per Knight Frank is at $1,273 per square feet per annum. For high streets, it’s estimated at $4,099 per square feet per annum.

Popcorn crowd vs serious shoppers

Unlike malls with a lot of tenants that offer entertainment options like movie theatres, game zones and more, high streets also bring in serious shoppers. It’s evident from the fact that most jewellers who can afford high rentals, choose to stay away from malls.

“Jewellery in particular, is not an instant-decision product and many jewellers, despite having the financial wherewithal to expand in malls, refrain from malls and prefer high street retailing in India as they want to stay away from the ‘popcorn crowd’ of shopping malls,” the report said.

High streets tend to attract more non-modern retailers or mom-and-pop stores and Indian retailers. Modern and international retailers are skewed towards malls. The high streets across the top 8 cities have an average of 44% modern retailers and 56% non-modern retail arenas.

“Most international retailers, especially in apparel, home décor and food and beverage categories, require multi-floor or contiguous retail spaces for their stores to display merchandise or offer an experiential feast to customers, which is hard to find in high streets,” Knight Frank said.

India’s best high streets

A few high streets like Brigade Road and Indiranagar in Bangalore; Colaba Causeway in Mumbai, Connaught Place and Khan Market in NCR, which have seen mega retailer expansion and early advent of modern retail have managed to attract top-end Indian and international brands.

“These high streets are famous for their mix of regional and international showrooms and have a loyal customer base. In these three cities, the real estate footprint of international origin brands ranges between 13-15%, which is much higher compared to the other cities,” the report said.

Delhi’s Lajpat Nagar too has both non-modern and modern retailers operating head-to-head in what is regarded as one of the most prominent wedding shopping destinations in the country.

Each city’s high streets have a mix of different retailers. Bangalore has a high concentration of food and beverage retailers with breweries, drinking holes and more. In fact, four of the top 10 high streets are in the city, and the city has the highest mix of modern retailers. Chennai, on the other hand, is skewed towards regional and Indian giants, so are other South markets.

Mumbai’s high streets, on the other hand, have prohibitively high rentals, and most of its older retailers in prime locations tend to own their properties, which aids convenient retail businesses.

While none of Ahmedabad’s high streets feature in the top 10 list compiled by Knight Frank, the city’s SG Highway has the highest spending quotient amongst the 30 high streets.