- Main streets lead Q3 leasing with a 68% share; malls account for 32%
- Delhi NCR, Hyderabad and Mumbai together account for 61% of quarterly leasing
- Grade A mall vacancy falls below 5%; ~12.7 MSF of supply expected through 2028
India’s retail real estate sector continued to see active occupier demand in Q3 2026, with gross leasing volume (GLV) reaching 2.22 million square feet (MSF) across the top eight cities, according to Cushman & Wakefield’s Q3 Retail MarketBeat Report. Leasing moderated by 7.3% quarter-on-quarter (QoQ) and 4.4% year-on-year (YoY).
Year-to-date (YTD) retail leasing reached 6.57 MSF, remaining broadly stable YoY with a 0.4% increase, indicating sustained retailer demand even as the market saw no new Grade A mall supply for the third consecutive quarter.
Main streets led leasing activity in Q3 2026, accounting for 67.9% of total volumes at 1.51 MSF, up 29.3% QoQ and 33.1% YoY, supported by demand for prominent, high-visibility retail locations. Mall leasing stood at 0.71 MSF, accounting for the remaining 32.1%, with volumes declining 42.1% QoQ and 37.8% YoY, while availability of quality mall space remained constrained.
Domestic retailers maintained their dominant position in Q3 2026, accounting for 86.3% of leasing activity at 1.92 MSF, reflecting continued expansion by home-grown brands. International retailers accounted for the remaining 13.7% with leasing volumes of 0.30 MSF.
At the city level, Delhi NCR, Hyderabad and Mumbai emerged as the three largest leasing markets, together accounting for 61% of overall activity during Q3 2026. Delhi NCR led with 0.55 MSF and a 24.9% share, followed by Hyderabad at 0.45 MSF (20.3%) and Mumbai at 0.35 MSF (15.7%).
Across the remaining markets, Bengaluru recorded 0.24 MSF of leasing, followed by Pune at 0.21 MSF, Chennai at 0.18 MSF, Ahmedabad at 0.13 MSF and Kolkata at 0.10 MSF.
City-wise leasing (MSF)
|
City |
Q3 2025 (GLV in MSF) |
Q2 2026 (GLV in MSF) |
Q3 2026 (GLV in MSF) |
QoQ Change |
YoY Change |
|
Delhi NCR |
0.51 |
0.67 |
0.55 |
−17.7% |
7.9% |
|
Hyderabad |
0.38 |
0.37 |
0.45 |
22.0% |
18.3% |
|
Mumbai |
0.59 |
0.50 |
0.35 |
−29.5% |
−40.8% |
|
Bengaluru |
0.18 |
0.25 |
0.24 |
−3.8% |
39.0% |
|
Pune |
0.33 |
0.25 |
0.21 |
−15.6% |
−36.2% |
|
Chennai |
0.16 |
0.20 |
0.18 |
−8.7% |
12.1% |
|
Ahmedabad |
0.11 |
0.11 |
0.13 |
18.6% |
15.8% |
|
Kolkata |
0.06 |
0.05 |
0.10 |
113.5% |
68.8% |
|
Total |
2.33 |
2.40 |
2.22 |
−7.3% |
−4.4% |
Category-wise, Fashion remained the largest demand driver with a 24.9% share of quarterly leasing, followed by F&B at 19.2% and Accessories & Lifestyle at 13.1%. Together, the three categories accounted for 57.2% of overall leasing activity. Department Stores and Entertainment remained other key demand contributors, with shares of 7.8% and 7.5%, respectively.
The sustained retailer activity, coupled with the absence of new Grade A mall supply for the third consecutive quarter, kept availability constrained across key markets. Grade A mall vacancy declined by 20 basis points QoQ to 4.8% in Q3 2026, from 5.0% in the previous quarter.
On the rental front, prime high-street rents increased by an average of 2.1% QoQ and 6.8% YoY in Q3 2026, reflecting continued demand across established retail corridors. Rental appreciation remained selective and location-specific, with Chennai’s Cathedral Road–RK Salai, Mumbai’s Linking Road, Chembur and Fort/Fountain, and Delhi NCR’s Khan Market recording the strongest YoY increases among the tracked high streets.
Looking ahead, approximately 12.7 MSF of Grade A mall supply is expected through 2028, which will gradually improve the availability of quality retail space across key markets. The pipeline will be led by Delhi NCR, followed by Bengaluru and Chennai, with approximately 1.35 MSF projected for completion in 2026 and the remaining supply expected through 2028.
Gautam Saraf, Executive Managing Director – Mumbai & New Business, Cushman & Wakefield, said
“India’s retail market continues to demonstrate steady underlying occupier interest, even as quality retail space remains constrained. While leasing moderated during the quarter, year-to-date activity remains largely in line with last year, with a slight increase. This is despite three consecutive quarters without new Grade A mall supply, indicating that limited availability is increasingly influencing the pace of leasing. As we enter the festive period, we expect strong consumption sentiment to provide an additional tailwind for retailers and reinforce the underlying demand environment. On the supply side, Grade A mall vacancy has tightened to below 5%, underscoring the limited availability of quality space. Against this backdrop, the 12.7 MSF supply pipeline through 2028 comes at an important point in the market cycle. As this stock enters the market, it should create greater headroom for brands to expand and could unlock demand currently constrained by limited options. Importantly, the opportunity will not be defined by supply alone. Location, quality, accessibility and the ability to deliver a differentiated consumer experience will determine which assets capture that demand.”
Milin Rohinesh, Head of Retail-India, Cushman & Wakefield, added
“Retail demand remained broad-based in Q3 2026, with fashion, F&B and lifestyle categories together accounting for more than half of quarterly leasing. The diversity of activity across categories highlights the continued evolution of India’s organised retail market, supported by newer concepts and the expansion of home-grown brands. International retailer activity also continues across the premium and luxury segments, reflecting sustained interest in the Indian market. At the same time, limited availability of quality retail space continues to influence the pace of brand expansion. The definition of quality retail itself is also evolving, with greater emphasis on well-positioned, experience-led destinations that bring together the right tenant mix and consumer experience. As the market evolves, we expect the focus on high-quality, well-curated and experience-led retail destinations to strengthen further.”
City-specific insights:
- Ahmedabad: Retail leasing reached ~0.13 MSF, registering growth of 18.6% QoQ and 15.8% YoY, and accounting for 5.7% of total activity.
- Bengaluru: The city recorded 0.24 MSF of retail leasing in Q3 2026, accounting for an 11.0% share of overall activity. Volumes moderated marginally by 3.8% QoQ but remained 39.0% higher YoY.
- Chennai: The city recorded leasing of 0.18 MSF, accounting for 8.3% of overall activity. Leasing moderated 8.7% QoQ while increasing 12.1% YoY.
- Delhi NCR: Retail leasing stood at 0.55 MSF in Q3 2026, accounting for ~25% of pan-India leasing activity. Leasing volumes moderated by 17.7% QoQ but remained 7.9% higher YoY.
- Hyderabad: The city recorded 0.45 MSF of retail leasing, representing 20.3% of total leasing. Activity increased 22.0% QoQ and 18.3% YoY.
- Kolkata: The city recorded 0.10 MSF of leasing, representing 4.6% of overall activity, with volumes rising 113.5% QoQ and 68.8% YoY.
- Mumbai: Retail leasing reached ~0.35 MSF during the quarter, representing a 15.7% share. Leasing moderated by 29.5% QoQ and 40.8% YoY.
- Pune: Retail leasing stood at approximately 0.21 MSF, representing 9.5% of overall activity. Leasing moderated 15.6% QoQ and 36.2% YoY.
