Robust leasing momentum in malls despite limited inventory in quality malls in the city

• Bengaluru registered approximately 0.2 mn sq ft of mall leasing during the quarter, with most activity concentrated in the Suburbs submarket due to minimal vacancy in Prime City and Secondary submarkets.
• The city’s high streets maintained strong retailer demand, led primarily by Fashion & Apparel, Food & Beverage, and jewellery brands. Key tenants leasing space included Bershka, Uniqlo, H&M among others.

No new malls commenced operations in Q1 2026

• Mall inventory declined to 14.4 million sq ft this quarter following the withdrawal of Brookfield/Cosmopolitan Mall from the Suburbs submarket. Overall mall vacancy was down 110 bps q-o-q, supported by sustained leasing activity.
• Phoenix Market City Phase 2, Forum 13 Degree North, and Forum Sarjapur Road are set to strengthen the city’s retail pipeline in the coming years, while Brigade Cornerstone Utopia Mall is expected to open in the Suburbs submarket by Q4 2026.

Capital values and rents record modest quarterly growth

• Capital values in Bengaluru’s retail sector increased in Q1 2026 following a steady rental growth in the city’s premium locations amid rising demand for quality mall space.
• Retail rents continued to rise during the quarter, supported by supply-demand imbalance, particularly in superior grade malls in the city.

Outlook: Bengaluru’s retail sector to be sustained growth buoyed by strong demand and mall space additions

• No new malls are lined up the Prime and Secondary submarkets over the short to medium term, with Suburbs expected to drive the additions to mall inventory going forward.
• The Bengaluru retail market remains growth-driven, with healthy income levels and growing residential clusters driving demand from fashion, food & beverage (F&B), and entertainment retailers and correspondingly new supply is planned.