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HomeUrban NewsKolkataKolkata Retail Market Experiences Remarkable 70% Growth in Leasing Activity

Kolkata Retail Market Experiences Remarkable 70% Growth in Leasing Activity

Kolkata Retail Market Experiences Remarkable 70% Growth in Leasing Activity

Kolkata’s retail market has witnessed an impressive transformation, with gross leasing activity surging by 70% in 2024, compared to the previous year. This leap has significantly enhanced the city’s share of India’s total retail gross leasing, which has risen from 3% in 2023 to 5% in 2024. Although Kolkata’s figures are still modest when compared to top-tier cities like Delhi NCR, Mumbai, Bengaluru, Chennai, Pune, and Hyderabad, this rapid growth is a promising indicator of the city’s evolving retail landscape.

Data released by real estate consultancy firm JLL India reveals that Kolkata’s retail gross leasing grew from 2.6 lakh square feet in 2023 to 4.4 lakh square feet in 2024. This marks a significant step forward for the city’s retail sector, despite the overall increase in national leasing being more subdued. India’s retail gross leasing rose by a modest 7%, from 81 lakh square feet in 2023 to 87 lakh square feet in 2024, demonstrating that Kolkata’s progress outpaced the national trend. The growth in Kolkata’s retail market reflects a shift in the city’s commercial appeal, and suggests an underlying optimism for the future of the sector.

Fashion and apparel dominate the retail leasing pie, with 51% of the total leased space dedicated to these sectors, followed by food and beverage (9%), jewellery (8%), and home furnishing and daily needs (7%). Consumer durables contribute 6%, with beauty, wellness, and cosmetics comprising 4%. Entertainment, which typically draws significant interest in major cities, accounts for just 2% of total leasing activity. However, JLL’s report reveals a fascinating shift in leasing dynamics, with domestic brands leading the way, comprising an overwhelming 85% of all retail leasing activities in India. Meanwhile, the influx of international brands nearly doubled, growing from 14 in 2023 to 27 in 2024.

The rise of international retailers has contributed significantly to the growth of retail leasing across India, with these brands accounting for 1.7 million square feet of leasing activity in 2024. Yet, the impact of domestic players remains strong, with Indian brands making up 80% of all retail leasing activity in the year. Despite these gains, a reduction in new retail supply could slow the momentum. New retail space additions in 2024 fell by 73%, compared to 2023, which could hamper further growth if demand outpaces available space.

Sustainability in the Retail Growth Story: Green Retail Spaces on the Horizon?

While Kolkata’s retail sector has made notable strides, the question of sustainability in this rapid urban development remains crucial. The city’s growing retail market, driven by both domestic and international brands, provides a significant opportunity to integrate sustainable practices into the retail environment. From reducing carbon footprints to promoting eco-friendly materials and energy-efficient designs, the evolving landscape of retail spaces presents an avenue for fostering sustainability. In the long term, retail developers and landlords in Kolkata will need to adopt green building practices to align with national sustainability goals and meet consumer expectations for eco-conscious shopping.

Retail spaces that prioritise sustainability can enhance their appeal to a more environmentally aware consumer base, while also contributing to Kolkata’s environmental goals. With retail leasing expanding at such a pace, it is vital for new developments to ensure that they are designed with sustainability at the forefront. This includes implementing energy-efficient infrastructure, using sustainable materials, and focusing on waste management to reduce the environmental impact of these spaces. As retailers and developers continue to navigate the evolving market, integrating sustainability into their business models will not only help mitigate the effects of urban expansion but also contribute to the city’s long-term environmental health.

Kolkata’s Retail Revival: A Boost to Employment and Local Economy

Kolkata’s retail leasing boom is also a boon for its economy, providing new job opportunities and stimulating local businesses. The city’s expanding retail footprint is set to create thousands of jobs in sectors such as sales, logistics, and retail management. As brands flock to prime retail locations, the demand for skilled workers in these fields is expected to rise. Moreover, this growth can benefit ancillary sectors like construction, transport, and real estate, which will see increased activity as retail spaces are developed or renovated.

The positive economic impact of the retail sector cannot be understated, particularly in a post-pandemic recovery scenario. As the city’s commercial real estate market continues to expand, it will likely witness a ripple effect on the overall economy, driving consumer spending, increasing tax revenues, and enhancing the city’s position as a retail destination.

Kolkata Retail Market’s Future: Balancing Growth and Sustainability

In conclusion, Kolkata’s retail market is undergoing a period of substantial growth, positioning the city as an emerging retail hub in India. While growth in leasing activity has been substantial, the need to incorporate sustainability into future retail developments will be a key determinant of long-term success. As domestic and international brands continue to make their mark on the city, they must take proactive steps to align their business practices with environmental goals. For Kolkata, the challenge will be to balance economic growth with sustainable urban development, ensuring that the city’s retail sector contributes to the city’s prosperity while preserving the environment for future generations.

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