Home / Knowledge / News / Retail / Under-performance, high rentals hit Indian retailers: JLL

Under-performance, high rentals hit Indian retailers: JLL

Sep '19
Pic: JLL
Pic: JLL
Indian retailers have realised that high rentals across malls in metros are adding to the stress on their business and rapid urbanisation, changing demographics, evolving consumer preferences, and the advent of new formats have created opportunities in tier-II and tier-III cities, according to a new report by US commercial real estate services firm JLL.

The report, titled ‘Urbanisation, Aspiration, Innovation—The New Paradigm of India Retail’, was released at the India Retail Forum organised on 24-25 September in Mumbai.

The newer markets are where the growth and large population of aspirational India is. Those who go in early will surely build legacies, the report says.

Poor store efficiency across malls have become a challenge for most. Rent-to-revenue ratio has become a dominating metric to evaluate their store presence as against the top-line revenue. Omni-channel retailing and expansion in tier-II and tier-III locations, therefore, is a key strategy to mitigate the risks.

Leases are being renewed at steep premiums in malls where occupancy is around 90 per cent. As a result, many marquee malls have seen a three-fold jump in rentals. Premium brands are renewing their leases at almost twice the earlier rents. This has resulted in the tenure of mall leases being shortened, and thus, many brands are finding it difficult to survive under the burden, the report adds.

Tier-II and Tier-III markets offer many advantages, which include unexplored locations and 30-40 per cent lower real estate costs than those in metros and tier 1 markets.

Fibre2Fashion News Desk (DS)

Interviews View All

Manfred Mentges, Sedo Treepoint GmbH

Manfred Mentges
Sedo Treepoint GmbH

We see a higher demand in colour management systems, as customers see big...

Jurgen Gauger, Spreadshirt

Jurgen Gauger

‘Buying crowdsourced or creative designs are much more appealing to the...

Top executives, Textile industry

Top executives
Textile industry

GST has levelled the playing field to an extent

Ravi Raj Desai,

Ravi Raj Desai

Himalaya Cotton Yarn Ltd manufactures high quality denier. The spinning...

Ravi Kant Prakash,

Ravi Kant Prakash

A crucial role in the process of fabric manufacturing is played by the...

Will Qian,

Will Qian

Honghua Digital Technology Stock Co., Ltd. specialises in the R&D,...

Pierre Wiertz, EDANA

Pierre Wiertz

EDANA, the international association serving the nonwovens and related...

Steve McCullough & Marco Weichert, Functional Fabric Fair & Design and Development GmbH Textile Consult respectively

Steve McCullough & Marco Weichert
Functional Fabric Fair & Design and Development GmbH Textile Consult respectively

Functional Fabric Fair is a trade-exclusive event showcasing the latest...

Dave Rousse, INDA

Dave Rousse

INDA, the Association of the Nonwoven Fabrics Industry, serves hundreds of ...

Priya Somaiya, Usha Social Services

Priya Somaiya
Usha Social Services

The Usha Silai label from Usha International is all set for a retail...

Varsha Wadhwa, VW

Varsha Wadhwa

Coming from a family that ran a business of jute and linen mills since...

Sneha Arora, Label Sneha Arora

Sneha Arora
Label Sneha Arora

Sneha Arora, an alumnus of National Institute of Fashion Technology,...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


Letter To Editor

(Max. 8000 char.)

Search Companies


Leave your Comments

October 2019

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category

Related Categories:

Follow us on instagram


Follow Fibre2Fashion On

Advanced Search