Indian Retail REITs Market Set to Reach ₹80,000 Crore by 2030: ANAROCK

India’s retail real estate segment is on the verge of a major transformation. According to ANAROCK’s latest research, the country’s retail Real Estate Investment Trusts (REITs) market could expand to a ₹60,000–₹80,000 crore opportunity by 2030, making up nearly 30–40% of India’s total REIT market, projected to touch ₹2 lakh crore (USD 25 billion).

Currently dominated by commercial office assets, India’s REIT landscape is ready for diversification as retail malls, shopping centres, and mixed-use developments mature into stable, income-yielding assets capable of institutional listing.

The Shift from Offices to Retail

For years, India’s REIT story has been driven by the office sector. Of the five REITs currently listed in India, four are office-focused and only one — Nexus Select Trust — is centered on retail. However, the next five years could see two to three new retail REITs emerging as high-quality malls across Tier-I and Tier-II cities achieve operational maturity.

“Retail is no longer an afterthought in Indian real estate portfolios,” said Anuj Kejriwal, CEO & MD of ANAROCK Retail. “With Grade A malls stabilizing, we expect the segment to evolve into a resilient, high-yield asset class that’s ready for public markets.”

Drivers of the Retail REIT Revolution

1. Consolidation of Grade A Retail Assets

Large developers such as Phoenix Mills, Prestige Estates, and Nexus Malls are consolidating premium mall portfolios to meet institutional investment standards. These properties are characterized by stable tenant mixes, long lease tenures, and consistent rental yields.

2. Steady Consumption Growth

India’s urban consumption is booming. Rising disposable incomes and a growing middle class have spurred spending across categories — especially apparel, food & beverages (F&B), and lifestyle retail. According to ANAROCK, 55% of all new mall absorption in H1 2025 came from these segments.

3. Institutional Capital Inflow

Global investors see retail as the next frontier in India’s real estate market. Pension funds and sovereign wealth funds are actively scouting for stabilized retail assets that can be packaged into REITs over the next three to five years.

Key Market Trends in 2025

Surge in Mall Construction and Leasing

The first half of 2025 saw 2.8 million sq. ft. of new mall supply across India’s top seven cities — a 155% jump over 2024. Net absorption stood at 2.0 million sq. ft., reflecting robust tenant demand.

Most new developments are large-scale, experience-driven malls averaging 1–1.2 million sq. ft. each, with entertainment, F&B, and lifestyle outlets comprising nearly half the total space.

Tier-II Cities Emerge as Retail Hotspots

Smaller cities such as Indore, Coimbatore, Surat, Bhubaneswar, and Chandigarh are witnessing the entry of institutional mall developers for the first time. High-income urban clusters in these regions are fueling a new consumption wave that mirrors patterns seen in metros a decade ago.

Developers are focusing on integrated lifestyle destinations that combine shopping, dining, and entertainment — creating sustainable long-term footfall for retailers and investors alike.

High Streets Outperform Traditional Malls

Interestingly, while malls are expanding, high street retail is also thriving. According to ANAROCK, rentals on high streets in Delhi, Mumbai, and Bengaluru have appreciated 8–10% annually, outperforming many enclosed malls where rents have remained largely stagnant.

This dual trend underscores a shift in consumer preference — combining premium mall experiences with convenient high-street accessibility.

Retail REITs: A New Institutional Asset Class

Retail REITs represent a fundamental shift in India’s property investment landscape. By pooling income-generating retail assets, developers can unlock liquidity, while investors gain access to stable, inflation-hedged returns.

ANAROCK’s report projects that once listed, India’s retail REITs could deliver yields of 8–9%, comparable to commercial REITs but with the added advantage of consumption-linked revenue growth.

These retail REITs will mirror trends from mature global markets, where 15–25% of REIT capitalization comes from retail portfolios.

Evolution of the Indian Mall: From Shopping to Social Experience

India’s organized retail sector is no longer focused solely on square footage. The modern mall is evolving into a community-centric, experiential hub.

Key trends include:

• F&B and Entertainment Integration: Dining, multiplexes, and gaming zones occupy nearly 40–50% of new mall areas.

• Smart Design: Malls are adopting open layouts, natural lighting, and event spaces to enhance visitor engagement.

• Sustainability Focus: Green certifications, solar rooftops, and waste management systems are becoming standard.

• Omnichannel Adaptation: Retailers are blending online and offline strategies to optimize store profitability.

This transformation makes retail properties not just consumption centers but lifestyle destinations — improving resilience against e-commerce disruption.

The Investment Outlook Through 2030

1. Retail REIT Value Potential

ANAROCK estimates the retail REIT market to reach ₹60,000–₹80,000 crore by 2030, making it a critical pillar of India’s institutional real estate. This growth assumes only partial listings of institutional portfolios, meaning the potential could exceed this projection if more assets enter the REIT structure.

2. Market Share Expansion

Retail REITs are expected to represent 30–40% of India’s total REIT capitalization, up from less than 10% today.

3. Developer Participation

Major players like Phoenix Mills, Prestige, and Nexus Select Trust are already building scalable mall portfolios suited for REITs, while new entrants from the hospitality and commercial sectors are exploring hybrid retail models.

Challenges to Overcome

Despite optimism, several challenges remain for India’s retail REIT ecosystem:

• Volatility in Consumer Spending: Inflation and interest rate changes could affect discretionary purchases.

• Retailer Profitability: Some categories continue to face margin pressure due to rising rents and competition from online platforms.

• Asset Fragmentation: Many retail properties remain under local or family ownership, complicating consolidation efforts.

• Operational Complexity: Managing multi-tenant, experience-driven assets requires high operational expertise and standardization.

However, these challenges are being addressed through institutional partnerships and improved asset management practices.

Conclusion: Retail’s Rise to the REIT Stage

India’s retail real estate market is undergoing a profound transformation — from fragmented ownership to institutional scale. As urban consumption accelerates and Grade A malls mature, retail REITs are poised to become one of the most dynamic investment vehicles in the country’s property ecosystem.

By 2030, India will likely see a robust ecosystem of retail-focused REITs spanning metros and Tier-II cities, bridging developers, investors, and consumers through a new era of transparent, income-generating real estate assets.

Disclaimer:
This article is based on ANAROCK Retail’s research and public data as of October 17, 2025. It is intended for informational purposes only and should not be taken as investment or financial advice.