India’s organised retail real estate market recorded strong growth in the first half of 2026, with gross leasing rising 20 per cent year-on-year to around 3.9 million square feet, reflecting sustained retailer expansion despite inflationary pressures and geopolitical uncertainties, according to a report by real estate consultancy CBRE.
The report said the leasing momentum was driven by continued expansion across organised retail, with sectors such as fashion and apparel, entertainment, jewellery and experience-led retail formats leading demand.
CBRE said the sector is expected to maintain its growth trajectory, supported by upcoming Grade A retail developments and major infrastructure projects, including expanding metro networks and ring roads, which are expected to improve connectivity and broaden consumer catchment areas.
During the January-June 2026 period, around 0.9 million square feet of new retail space became operational, with Delhi-NCR accounting for the entire new supply during the first half of the year.
Fashion and apparel remained the largest contributor to leasing activity, accounting for around 40 per cent of total space absorption. The segment’s growth was led by department stores, mid-range fashion brands and athleisure retailers.
The Food and Beverage segment accounted for around 14 per cent of leasing activity, followed by Entertainment at 9 per cent. Jewellery and Homeware & Furnishings each contributed around 7 per cent, while Consumer Electronics accounted for 6 per cent of total leasing.
The report highlighted strong demand beyond major metropolitan centres, with fashion and apparel retailers continuing to expand aggressively into Tier-II cities. The segment accounted for around 69 per cent of leasing activity in Chandigarh and Jaipur, and about 65 per cent in Kochi, underscoring the growing importance of emerging retail markets.
According to CBRE, domestic retailers contributed more than 70 per cent of total leasing activity during the first half of the year, while direct-to-consumer (D2C) brands accounted for around 28 per cent of overall leasing.
The report also projected sustained institutional investment in organised retail real estate. It said shopping malls are expected to increasingly adopt experience-led formats and mixed-use developments to enhance consumer engagement and support long-term growth in the sector.
