Growth of Malls in Non-Metro Cities: Developers Remain Bullish on Potential of Organised Retail

As locations for malls in metros are maturing rapidly, brands and developers are eyeing unexplored territories. They are capitalising on the growing demand as well as a lack of entertainment options and organised retail in Tier II and beyond…

- Charu Lamba

As incomes rise, aspirations change and brand awareness increases among non-metro consumers, an increase in the number of malls has been observed in the largely untapped nonmetro cities.

As locations for malls in metros are maturing rapidly, brands and developers are eyeing unexplored territories. They are capitalising on the growing demand as well as a lack of entertainment options and organised retail in Tier II and beyond.

Non-metros like Ahmedabad, Jaipur, Ludhiana, Indore, Chandigarh, Bhopal, Surat, Amritsar, Nagpur, and Lucknow have accommodated a healthy percentage of retail growth over the last few years mostly because these cities have very favourable demographics and a high propensity to consume, which naturally attract national and international brands. Consumers in some of the non-metro cities around New Delhi travel to the malls here to shop for luxury and high-end brands, but mid and mass-segment brands are much better equipped to leverage the demand in non-metros, and many are trying to gain first-mover advantage.

What Research Says

According to a recent ANAROCK research, 31 malls over 13.5 million sq. ft. will come up in non-metro cities such as Ahmedabad, Lucknow, Indore, Surat, and Nagpur, among others.

Among non-metro cities, Ahmedabad stands out with as many as 6 new malls slated to come up in the city by 2022-end. These new malls will be spread over 3.2 million sq. ft. Both domestic and international brands are gung-ho on Ahmedabad; besides scoring high on consumerism, the city has a growing young population of entrepreneurs, IT professionals and factory employees.