India’s shopping malls are about to get a financial makeover. According to ANAROCK Research’s new report “Indian Retail REITs: The Next Growth Frontier,” the country’s retail Real Estate Investment Trust (REIT) market is projected to grow to INR 60,000–80,000 crore (USD 6.8–9 billion) by 2030, making up 30–40% of India’s total REIT market, which itself is expected to reach INR 2 lakh crore (USD 25 billion) by the decade’s end.
This marks a dramatic evolution from today’s scenario, where retail REITs constitute only about 15% of the INR 1.67 lakh crore Indian REIT market, overwhelmingly dominated by office assets.
🏬 Retail REITs: From Concept to Mainstream
At present, India has five listed REITs, of which only one — Nexus Select Trust, backed by Blackstone — is retail-centric. The rest (Embassy, Mindspace, Brookfield, and DLF’s DCCDL) focus on office properties.
But with Grade-A malls maturing into stable, income-generating assets, analysts foresee 2–3 new retail REITs launching within the next 3–5 years. These could likely come from established developers such as Phoenix Mills, Prestige Estates, DLF, and Nexus Malls, which together control over 34 million sq. ft. of leasable retail space across more than 60 malls nationwide.
🌆 Tier-II Cities: The New Retail Frontiers
The growth story is no longer confined to metros. ANAROCK’s data shows that the next retail REIT boom will be powered by Tier-II cities — Indore, Coimbatore, Surat, Bhubaneswar, and Chandigarh — where rising incomes and consumption are attracting institutional capital for the first time.
Developers like Phoenix Mills, Prestige Estates, and Nexus Malls are expanding aggressively into these regions, with new projects averaging 1–1.2 million sq. ft. each. Notably, entertainment, F&B, and lifestyle retail now account for nearly half of the space in new mall developments — a clear pivot toward experience-driven retail.
“The retail growth story is no longer metro-centric,” said Anuj Kejriwal, CEO & MD, ANAROCK Retail. “Consumption-led cities with young, aspirational populations are becoming key targets for institutional investment.”
Demand-Supply Dynamics: Malls Rebound Strongly
India’s retail real estate has rebounded sharply post-pandemic. As per ANAROCK’s RELEAP H1 2025 report, 2.8 million sq. ft. of new mall space was added in the first half of 2025 — a 155% surge compared to H1 2024.
Net absorption stood at 2 million sq. ft., up 31% year-on-year, with apparel and F&B sectors leading the charge, accounting for 55% of total leasing.
This robust absorption indicates strong consumer sentiment and sustained retail spending — essential ingredients for REIT performance.
🛍️ Changing Tenant Mix: ANAROCK Retail REIT Report 2025
High-value consumption categories — fashion, dining, and entertainment — are reshaping tenant portfolios. Developers are prioritizing experiential destinations over traditional retail layouts, emphasizing dwell time, ambiance, and lifestyle integration.
“Consumers are spending more time and money on experiences — and that’s exactly where institutional developers are focusing,” Kejriwal added.
Meanwhile, high streets across major metros are witnessing steady rental appreciation, while mall rentals have plateaued — highlighting a nuanced market where location strategy and footfall quality drive long-term value.
💰 Why Retail REITs Matter for Investors
Indian Retail REITs open a new avenue for investors seeking steady income and inflation-hedged returns without owning property directly. Much like mutual funds, REITs pool investor capital to buy and manage income-generating real estate and trade on exchanges — offering liquidity, diversification, and transparency.
Typical benefits include:
- Steady yields from long-term leases with strong anchor tenants (apparel, F&B, entertainment)
- Inflation-linked rent escalations
- Portfolio diversification across property types
- Ease of access via listed REIT units
With Indian REITs already delivering 6–7.5% yields, retail REITs are expected to attract significant investor interest as high-yield, resilient assets amid a rising consumption cycle.
🧭 The Road Ahead
ANAROCK Retail REIT report 2025 forecasts several key shifts shaping India’s retail REIT future:
- Top 5 mall owners will control nearly 60% of India’s organised retail stock.
- New retail REITs will further institutionalize the market, attracting global investors.
- Mixed-use redevelopment will redefine older malls into integrated lifestyle districts combining retail, dining, and entertainment.
“Retail is no longer an afterthought in Indian real estate portfolios,” Kejriwal concluded. “It is now edging closer to centre-stage as a resilient, high-yield asset class ready for institutional scale and public markets.”
Key Takeaway
Indian retail REITs evolution marks a defining shift in how investors access the country’s booming consumption story. As Grade-A malls mature and consumption deepens in Tier-II cities, the stage is set for REIT-driven retail real estate to become a mainstream investment avenue — potentially accounting for 40% of the REIT market by 2030.
With institutional capital flowing in, developers scaling up, and consumers demanding more experiential retail, the Indian mall isn’t just growing — it’s going public.
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