Delhi’s Khan Market has once again cemented its position as a retail hotspot, ranking as the 22nd most expensive main street globally in Cushman & Wakefield’s Main Streets Across the World report.
With a rent of USD 229 per sq ft per annum (sf/annum) (~ 19,330), Khan Market retains its place in the prestigious global list and continues to be the most expensive high street in India, registering a rental growth of 7% YoY. Growth
In its 34th edition, the report focuses on headline rents in 138 best-in-class urban retail locations worldwide, many of which are linked to the luxury sector using proprietary data from Cushman & Wakefield. A global index ranks the most expensive destinations in each market.
Global Retail Market Overview
Milan’s Via Montenapoleone, where rents have risen by nearly a third in the past two years, has overtaken New York’s Upper 5th Avenue to take the crown as the world’s most expensive retail destination, according to the report. For the first time, the European street has topped the global rankings in the firm’s flagship retail report.
Khan Market: A maintained high-end position
Saurabh Shatdal, MD, Capital Markets and Head-Retail-India, Cushman & Wakefield said, “Khan Market’s position among the world’s top retail destinations underlines the resilience and strength of India’s retail sector. Known for its curated mix of premium brands and upscale boutiques, Khan Market attracts affluent shoppers, cementing its reputation as a high-end retail hotspot. The limited availability of retail space in the area creates intense competition, which pushes up rental values. While malls are facing supply constraints, high streets across India are thriving, driven by strong demand and strong rental growth. As of YTD 2024, Main Streets recorded 3.8 msf leased, representing 11% year-on-year growth.”
Asia Pacific Ranking by Market 2024
In the Asia-Pacific retail landscape, Delhi’s Khan Market rose from 24th to 23rd among the region’s most expensive high streets, beating notable locations such as Bangkok’s Central Retail District, Jakarta’s Prime Main Street and Manila’s Bonifacio to 24th.
interestingly, Delhi-NCR Now hosts India’s top three most expensive retail high streets.
Along with Khan Market, Connaught Place (Delhi) and Galleria Market (Gurgaon) also topped the APAC rankings, with rents of USD 158 (INR 13,335) and USD 156 (INR 13,166) per sq ft respectively. The increase in limited space has made these areas highly competitive and consequently more expensive for brands seeking prime retail locations.
Macroeconomic impact and growth in India
Rents closely reflect the broader macroeconomic performance within the region. India has been the world’s strongest major economy this year, with Indiranagar 100 Feet Road in Bengaluru leading the region’s rent growth at 32% YOY. Rent growth increased by an average of 9% across the 16 tracked Indian locations, with notable growth in locations such as MG Road in Pune, Fort/Fountain in Mumbai and Park Street in Kolkata.
In contrast, Chennai’s Anna Nagar and Pondy Bazaar are some of the most affordable high streets in the region, with rents ranging between $25-26 per square foot per annum.
Main streets around the world – global ranking by market 2024
Competitive stress for limited space saw YOY rent growth in 57% (79) of the 138 locations, falling in just 14% (19), with the remaining 29% (40) flat. This resulted in a 4.4% increase in global average fares. The Americas was the strongest performer regionally at 8.5%, driven by rental growth of around 11% in the US – more than double the 5.2% recorded last year – followed by Europe and Asia Pacific at 3.5% and 3.1% respectively. Rents in 138 locations are now an average of 6% higher than pre-pandemic levels.
Global Outlook
Prime retail destinations have largely weathered the storm from interest rate hikes to tame inflation in 2022 and 2023, which have led to faster increases in the cost of living, weaker consumer sentiment and slower economic growth. Retail now stands to benefit from falling interest rates, economic recovery, easing cost of living pressures and accelerating real wage growth.
Shatdal added, “Globally, super-prime physical retail space remains central to retailers’ strategies, highlighting the enduring importance of vibrant shopping destinations like Khan Market. With India’s strong economic growth and evolving consumer preferences, the country’s retail sector is poised for continued success.”
Future projections for retail locations
The author of the report Dr. Dominic Brown, head of international research at Cushman & Wakefield said, “Increased discretionary spending among consumers will further boost the performance of prime retail destinations. How quickly and strongly that feeds into market-level rent growth will vary due to local nuances and market dynamics. Globally and regionally this year growth was led by the US, but there were really strong double-digit growth in certain markets in each region – in some cases truly exceptional – and others where rents have declined for one reason or another. However, the performance at the very top end underscores that the strength of ‘prime’ continues to grow and we expect that to continue as conditions improve.”