APPD Market Report Article


September 4, 2023

Dr Samantak Das, Head of Research, India


INR 138


Fashion retailers drive leasing activity

  • Fashion & Apparel and F&B sectors continued to drive demand in both malls and prime high streets. New leases and store openings were seen across prominent retail hubs like Anna Nagar, Royapettah, and Velachery.
  • Significant quarterly leasing volume was driven by national brands expanding their footprint.

No new project completions

  • There were no mall completions during the quarter. The city’s premier malls, like Express Avenue, Forum and Grand Marina, maintained tight vacancy rates while middling malls ran at elevated vacancy levels. 
  • The anticipated supply pipeline points to a vibrant retail sector with strong near-term completions of Airport Ozone mall, Rathinapuri and TNHB Mall. Together, these will add an additional 0.43 million sq ft to stock. Forum Mall OMR by Prestige Group and Shriram Divine City by Shriram Group are the prominent upcoming projects lined up for completion in the long term.

Mall rents remain unchanged

  • Despite the restricted mall supply and current low vacancy rates in prominent malls, rents remained unchanged throughout the quarter.
  • Overall market yields remained unaltered.

Outlook: Retailers adopt a multifaceted approach to enhance growth

  • Retailers are likely to prioritise right-sizing stores to optimise customer engagement and utilise the power of social commerce to transform the omnichannel customer experience.
  • F&B, fashion & apparel, entertainment, accessories and jewellery retailers are expected to dominate space take-up in the current market.

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

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