Retail leasing witnesses growth in Q3 2025

• The quarter recorded gross leasing of 0.24 million sq ft. Strong demand drove growth of 35% q-o-q and 39% y-o-y. The Suburbs drove 64% of retail leasing, followed by Prime City, which contributed 24% to the total gross leasing volume during this period.
• Fashion & Apparel remained the primary demand driver, accounting for 51% of gross leasing, followed by daily needs & grocery at 16%. High Streets dominated leasing activity with 86%, while malls contributed 14% to the quarterly total.

No new mall completions in Q3 2025

• No new shopping malls became operational during the quarter. Vacancy rates declined by 40 bps to reach an all-time low of 9.6%.
• No new shopping malls are scheduled for completion in Q4 2025. However, 2026 is likely to see substantial growth in new mall supply, with 0.9 million sq ft expected to become operational across three new assets.

Marginal rent increase driven by premium mall developments

• Low vacancy and healthy demand in malls resulted in rent appreciation to INR 167.12 per sq ft, per month, representing an 8.4% y-o-y and 0.7% q-o-q growth.
• The Prime Others submarket recorded the highest annual rent growth at 13.5%, attributed to the presence of Kolkata’s most premium malls, including South City Mall and Quest Mall. The Prime City submarket also demonstrated 7.4% yearly rent growth during the period.

Outlook: Upcoming supply in 2026 to strengthen retailer interest

• As no new supply is expected to come on stream in 2025, the stock is likely to remain at 5.9 million sq ft. In 2026, three quality malls are expected to be completed in the Suburbs.
• Retail leasing activity is likely to remain healthy in the coming quarters. Vacancy levels are expected to rise over the next 12 months due to new supply additions, which are projected to moderate rent growth momentum going forward.