Hyderabad retail real estate witnesses 145% growth; fashion, apparel key driver

Hyderabad: Hyderabad is now emerging as a hotspot for the retail real estate sector.

According to a recent report by CBRE South Asia Pvt Ltd, the absorption of retail space in Hyderabad witnessed a staggering 145 percent year-on-year (Y-o-Y) growth, reaching 0.49 million square feet, compared to 0.20 million square feet in the same period of January to September 2022.

The city's retail sector accounted for a substantial 10 percent share in leasing activity across the top eight cities in India during the January to September 2023 period. Notably, this growth has been primarily driven by fashion and apparel brands, which have dominated the retail landscape.

Significant Y-o-Y Growth:

In its report, 'India Market Monitor Q3 2023,' CBRE highlighted the remarkable growth, trends, and dynamics within Hyderabad's retail real estate market. During the July to September 2023 quarter alone, the city witnessed a total leasing of 0.26 million square feet, a significant increase from the 0.09 million square feet recorded during the same period in 2022. This quarterly growth represented a substantial Y-o-Y increase of 189 percent, underlining Hyderabad's appeal as a thriving retail destination.

Fashion and Apparel Take the Lead:

Throughout the nine months from January to September 2023, the fashion and apparel sector held a prominent share in leasing at 34 percent. Home and department stores accounted for 17 percent, while food and beverage outlets contributed 13 percent to the retail leasing landscape.

Key Players in Leasing Activity:

Delhi-NCR, Chennai, and Pune emerged as leaders in leasing activity within the fashion and apparel category, while home and department store leasing activity was most prominent in Pune, Ahmedabad, and Mumbai. Bengaluru stood out with the highest leasing share, contributing 30 percent during the January to September 2023 period. It was followed by Delhi-NCR at 19 percent, Pune at 12 percent, and Chennai at 11 percent.

Dominance in Retail Space:

During the July to September 2023 quarter, the total leasing of retail space reached an impressive 1.84 million square feet. A noteworthy observation was that Bengaluru and Pune collectively commanded a significant 59 percent share in retail space leasing. Bengaluru emerged as the clear frontrunner in leasing, capturing a substantial 35 percent share, followed closely by Pune with a 24 percent share. Hyderabad maintained a strong presence with a 14 percent share, and Delhi-NCR contributed 11 percent to the total leasing during this period.

Transformation in the Retail Sector:

Anshuman Magazine, Chairman & CEO – India, South-East Asia, Middle East & Africa, CBRE, emphasized the impending transformation in the retail sector. He noted that retailers are keen on revamping in-store experiences by incorporating cutting-edge technology, personalized services, and space optimization.