Bengaluru’s retail landscape remains vibrant, with retailers expanding to recently completed malls

• Bengaluru’s retail market remains active with retailers looking to expand across new premium retail developments as well as key high streets. The opening of new stores continues to draw footfall, fuelling the city’s retail real estate market growth.
• F&B retailers dominated leasing activity both in malls and high streets in Q1, followed by fashion, apparel and entertainment segments. Key retailers that were active during the quarter include URU Brewpark, ICB Indian Craft Brewery, Uniqlo, Westside and Torq.

No new mall completions in Q1 2025

• One mall in the secondary submarket was downgraded largely due to brand exits. This resulted in a drop in the city’s mall inventory, which now stands at 14.5 million sq ft.
• Brigade Cornerstone Utopia Mall is slated for completion in the Suburbs submarket in 2025.

Rents and capital values see marginal q-o-q increases

• With one mall being withdrawn during the quarter, city-level rents and capital values saw a 0.5% growth q-o-q. Otherwise, financial indicators were largely unchanged q-o-q.
• The city’s retail mall vacancy stands below 10% at end-Q1 2025, leading to an anticipated appreciation in rents and capital values in the near-term, driven by premium malls where retailers continue to evince interest backed by increased foot traffic.

Outlook: Retail market growth potential driven by robust IT sector and rising disposable incomes

• Bengaluru’s robust economic growth is expected to continue, aided by a strong IT and start-up ecosystem that will continue to fuel retailer expansion and store count additions.
• Several new malls in various stages of development or planning, indicate confidence in the sector’s future. Retail development is spreading to suburban areas, following the city’s expanding residential footprint and improved connectivity.