India’s new malls get bigger as retailers shift from stores to experiences

As per the latest business developments, India’s mall market is moving towards bigger, experience-led destinations as developers respond to changing consumer demand. The average size of new shopping malls is projected to more than double to 0.59 million square feet during 2026-30 from 0.25 million sq ft in the pre-2000 era, according to a CRE Matrix report.

The shift points to a fundamental change in how developers are designing retail assets, with malls increasingly being built around a broader consumption and experience ecosystem.

Malls get bigger, move beyond traditional anchors

The change comes as consumer-facing categories that drive experience and dwell time gain a larger share of mall leasing. Fashion, food and beverage, entertainment, leisure and wellness together accounted for 72 percent of mall leasing during 2023-25, up from 54 percent a decade earlier, the note stated.

“Shopping malls are no longer simply expanding; they are re-architecting themselves. The average new mall is set to nearly double in size as experience-led categories, fashion, F&B, entertainment, wellness, climb from 54 percent to 72 percent of leasing while traditional anchors, like department stores, essentials & grocery, retreat from 31 percent to 11 percent of demand,” stated Abhishek Kiran Gupta, CEO and co-founder, CRE Matrix and IndexTap.

Apparel and fashion alone increased its share to 35 percent from 25 percent, while F&B rose to 15 percent from 11 percent.

The shift suggests that developers may increasingly need to build malls around a broader consumption ecosystem rather than rely on a few large-format anchors to generate footfalls.

India at present has 114.3 msf of shopping mall stock across the 12 markets tracked by CRE Matrix, within a total organised retail stock of 186.2 msf. Another 40.4 msf of mall supply is anticipated through 2030, with Hyderabad and Gurugram together accounting for 51 percent of the identified pipeline.

Virender Kumar, VP-Marketing, Arete Group, stated India’s mall market is moving from a footprint-fuelled expansion cycle to a consumption- and experience-led one.

“Larger formats are not simply adding square footage as they are bringing retail, F&B, entertainment, leisure and wellness together to capture a greater share of consumer time and wallet,” he stated.

The concentration of upcoming supply additionally highlights the growing divergence between Indian retail markets. While Gurugram has the largest office-led amenity retail stock at 10 msf, Mumbai leads shopping mall rents.

Grade A mall vacancy ranges from just 1 percent in Thane to 13.6 percent in Gurugram, indicating that location, catchment and asset quality are becoming increasingly important as new supply comes on stream.

In the meantime, retailers are negotiating leases differently. Average retail lease tenure declined to 70 months in the first half of 2026 from 75 months in 2021, even as average lock-in periods rose to 28.6 months from 22.2 months.

“Lease structures are being rewritten in parallel: shorter headline tenures, paired with longer lock-ins, as landlords and retailers renegotiate who bears the risk of a maturing market,” Gupta stated.

Market observers stated that for developers, the larger format raises the stakes as bigger malls require stronger catchments and a more diversified tenant mix, while the wide variation in vacancy across cities suggests that simply adding supply may not guarantee absorption.

Kumar stated that for developers and retailers, the opportunity now is to convert this growing traffic into elevated dwell time, tenant productivity and repeat visitation.

“The next generation of Indian malls will be defined by how effectively they build and monetise consumer engagement,” he stated.