The sector also saw 1 million sq. feet of leasing activity in Q2 2022, up nearly 363% year-on-year and about 118% quarter-on-quarter.
“The retail sector made a robust recovery in Q2 2022, with transaction activity growing by more than 100% on a quarter-on-quarter basis; overall, in the first half of 2022, it reported massive growth of more than 160% on a year-on-year basis," according to the India Market Monitor—Q2 2022 insights released by real estate consulting firm CBRE.
This growth was a result of pent-up demand causing a renewal in physical retail visits even as online shopping continued to perform strongly.
“Across cities, we are witnessing brands resizing and recalibrating their physical store strategies to diversify their portfolio and expand their footprint, with ‘experience’ fast becoming an important frontier to bridge the retailer-consumer gap," it added.
Meanwhile, supply addition was down by over 50% quarter-on-quarter. However, the first half of 2022 saw a more than 500% increase in project completions compared to a year ago.
“We expect these positive sentiments to sustain in the near term even as retailers explore innovative means to attract their consumers and drive sales on both online and offline fronts," it said.
Meanwhile, the share of fashion and apparel retailers in leasing activity slowed down in Q2 of 2022 to 28% from 41% in the year-ago period, while that of homeware and department stores as well as entertainment grew in the same period. Activity by F&B players remained similar to a year ago levels.
CBRE said that going forward, for brands, omnichannel presence is likely to remain a key theme.
“Despite an uptick in online shopping, brick-and-mortar retail is here to stay. Retailers have acknowledged the strong correlation between the brand’s physical and online stores; so a mix of both is becoming prevalent across brands," it said.
Retailers are likely to continue to focus on resizing, rightsizing and relocating their stores in order to ensure long-term growth and broaden their customer base.
“As experiential retail becomes a buzzword across retail categories, the role of technology in delivering this experience will be critical. Technologies in retail such as virtual fitting rooms, fit scanners, smart mirrors, iBeacon, visualization tools, etc. are likely to provide a seamless experience to the consumers," it added.
