APPD Market Report Article

Mumbai

August 26, 2022

Dr Samantak Das, Head of Research, India & Sri Lanka

0.6%

INR 260

Rents
Rising

Mumbai retail sees a big q-o-q decline in net absorption

  • In 2Q22, net absorption for Mumbai retail declined sharply due to no new mall completions. Total absorption stood at just 8,800 sq ft in 2Q22.
  • Most of the leasing activity was recorded in the prime south and suburbs submarket. Brands like Only, Forever New, AND, Global Desi, Shantanu Nikhil, Victorinox and Divaa took up space in Phoenix High Street and Palladium malls.

No new mall completion in 2Q22

  • There was no new mall completion in 2Q22.
  • Jio World Centre at BKC in the prime north submarket is expected to become operational in 2H22.

Rents increase slightly in 2Q22

  • Overall rents increased slightly in 2Q22. Since rents remained unchanged over the past two years, the revision was on account of improved retail leasing momentum and mall footfall rising to near pre-COVID-19 levels.
  • Rents increased slightly for all the submarkets. Similarly, capital values also moved up slightly for all the submarkets, but at a higher pace, thus causing marginal yield compression.

Outlook: Retail market prospects appear positive

  • The future of the retail market appears more positive since the effects of COVID-19 have decreased drastically and the city has returned to pre-COVID-19 normalcy. People are now comfortable visiting malls since all COVID-19 restrictions have been removed. Theatres are also functioning at 100% capacity.
  • The retail sector is expected to see more traction across all submarkets since restrictions have been completely removed. Jio World Centre at BKC is likely to complete in 2022 in the prime north submarket with healthy pre-commitments. Retailers remain keen on brick-and-mortar retail even though they are also looking to adopt the omni-channel model.

Note: Mumbai Retail refers to Mumbai's overall prime retail market.

Talk to us 
about real estate markets.