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Retail Revolution in Tier-II Cities: Over 30 Brands Drive Growth
More than 30 major retail brands have opened stores in 14 Tier-II cities in India, transforming the retail landscape. This expansion includes both domestic and international brands, catering to the growing aspirations and purchasing power of consumers in these cities.
The retail sector in India is witnessing a significant expansion in Tier-II cities, with over 30 major retail brands opening their stores in 14 such cities during the January-September period of 2023. This growth is highlighted in a report titled "Tier-II Cities: The Time to Shine" released by property consultant CBRE.
Key Findings of the Report
According to the report, several domestic and international retail brands, including Croma, Armani Exchange, Malabar Gold & Diamonds, Reliance Smart, Tanishq, H&M, Marks & Spencer, GAP, Starbucks, Pizza Express, and Under Armour, have expanded their retail footprint to Tier-II cities. These cities include Chandigarh, Jaipur, Indore, Goa, Mangalore, Kochi, Lucknow, Patna, Ranchi, Guwahati, Bhubaneshwar, Vizag, Mysore, and Coimbatore.
Retail Real Estate Space in Tier-II Cities
The total retail real estate space in these 14 Tier-II cities stood at 29 million square feet as of September 2023. Jaipur, Lucknow, and Chandigarh each boast of retail real estate space ranging between 3 to 7 million square feet. The retail development in these cities has been a healthy mix of high streets and malls.
Factors Driving Retail Growth in Tier-II Cities
Anshuman Magazine, Chairman, India, Southeast Asia, Middle East & Africa of CBRE, attributes the retail growth in Tier-II cities to several factors. These include the e-commerce boom, a tech-savvy consumer base, growing aspirations, and a surge in discretionary purchasing. Investment-grade developers are setting up large-sized contemporary malls in these cities, which are seen as entertainment destinations rather than just places to shop.
The expansion of retail brands to Tier-II cities in India reflects the growing economic importance and consumer demand in these regions. With a growing population and increasing disposable incomes, Tier-II cities are emerging as attractive markets for retailers looking to expand their reach beyond metropolitan areas.
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