Net absorption down q-o-q

• Pune recorded net absorption of 28,844 sq ft in Q1 2026, a 37% q‑o‑q decline. With limited mall vacancies, high streets saw increased traction, accounting for 63% of total leasing. However, premium & high‑end brands continued to prefer malls, largely reflected as churn.
• The entertainment sector led leasing activity with a 51% share, followed by daily needs and grocery, largely in secondary micro‑markets across both high streets and malls.

No new supply was recorded in Q1 2026

• Supply remains constrained as developers prioritize mixed‑use schemes with supporting retail over standalone Grade A malls.
• The overall vacancy rate declined to 11.8% in Q1 2026, reflecting a 40 bps decline q-o-q.

Rental values increase marginally q-o-q

• Prime city saw a marginal increase of 0.4% q-o-q supported by limited leasing activity. With subdued new supply expected in the coming years, rents are expected to maintain an upward trajectory.
• Overall capital values increased significantly, with the Prime City market recording a 14.9% y-o-y growth.

Outlook: Retail demand is expected to remain robust in high streets, supported by limited upcoming mall supply

• Retail leasing is expected to grow, driven by strong demand from the entertainment, F&B, and fashion & apparel segments. Tightening vacancies in premium malls and limited future supply are likely to redirect more leasing activity toward high streets.
• Two projects totaling 0.7 million sq ft are anticipated to become operational in H1 2026, introducing new mixed-use developments in the form of support retail.