High Street Real Estate in India Growing Consistently

India is poised for a remarkable expansion in high street retail space. Leading developers like DLF, Godrej, Prestige group, Brigade enterprises, M3M, Omaxe, the Dhillon Group are set to develop approximately three million square feet of retail projects, complete with open spaces, over the next two to three years. This growth comes as a response to the significant demand for high street retail space in Indian cities, contrasting the prevalent focus on large shopping malls.

The Current Landscape and Future Potentials

Data from Cushman & Wakefield reveals a striking imbalance: only 13.2 million square feet of high street space is available to retailers in India, compared to a whopping 93 million square feet in malls. However, the potential consumption on high streets is nearly triple that of malls, highlighting a significant market opportunity.

Embracing Modern High Streets

Karan Dhillon, the owner of Dhillon Group, noted the lack of modern, organized high streets in India, despite the success of traditional markets. His company is addressing this by planning high street retail in Chandigarh, adding 1.5 million square feet. This new space will feature major brands like Uniqlo, Starbucks, Decathlon, and McDonald's.

DLF, India's largest real estate company, is also contributing to this trend with a commercial development in Gurgaon, echoing the successful DLF Galleria. Similarly, M3M announced a luxury high street retail project in Noida, integrating retail spaces with serviced studio apartments.

Hybrid Models: The Future of Retail

Mohit Goel, the managing director of Omaxe Group, attributes the surge in high street projects to the growing preference for hybrid models that blend offices, retail, recreational facilities, and food zones. Omaxe is developing over two million square feet of retail space across various cities, primarily in high street format.

The Competitive Edge of High Streets

High streets in India are increasingly commanding higher rentals than malls. For instance, rentals at Delhi's Khan Market recently peaked at Rs 1,600 per square foot per month. Major brands, especially in fashion and F&B, are actively seeking spaces in these prominent locations. This trend is partly driven by the limited availability of organized high streets and the fewer restrictions they faced during Covid-related lockdowns.

Integrating Retail and Office Spaces

Amish Bhutani, the managing director of Group 108, highlighted the unique aspect of high-street projects: retail spaces on lower levels with office spaces above, blending seamlessly into the local environment. Their project in Noida, One FNG, offers a vast space combining office and retail areas.