New Delhi prime retail net absorption drops 12% in Q1

There were no new malls that opened during the quarter.

Net absorption in New Delhi’s prime retail market declined by 12% q-o-q and by 59% y-o-y, as no new malls went operational in the quarter and prime malls maintained high occupancy levels. JLL says whilst the reinstated COVID-19 restrictions negatively affected footfall in January, it recovered quite rapidly in February and March.

Leasing activity in the Prime South, according to JLL, was mostly dominated by the F&B segment as Barbeque Nation, Haldirams, Perch, Saket Social and many other restaurants took up space in DLF Avenue, Saket. In Prime Others, Pacific Mall—both in Dwarka and Subhash Nagar—and Vegas Mall in Dwarka saw good leasing momentum.

Here’s more from JLL:

No retail malls were completed in 1Q22. In the coming quarters, more than 1.2 million sq ft of new supply is expected to be completed, mostly in the suburbs. Mixed-use developments, which comprise a retail block, along with Office are also included in the upcoming supply.

With improved connectivity, better infrastructure and a growing residential catchment, most of the new mall supply is lined up for the suburbs.

Rents remain stable

Rents remained stable across all malls.

Vacancy rates were down as well, given the increased traction in retail activity and the fact that quality malls continue to have very limited or no vacancy in them.

Outlook: Leasing activity expected to improve further by year-end

With COVID-19 cases decreasing and hardly any restrictions on movement, footfall is expected to increase further, which will encourage retailers to plan new store openings and boost leasing activity, pushing vacancy to near pre-COVID-19 levels.

Malls as part of transit oriented developments (TODs) are on the rise and we expect them to gain more momentum. The majority of the malls in the Prime Others and Prime South submarkets are based on the TOD model only.

Note: Delhi Retail refers to Delhi NCR's prime retail market.