Mumbai (Maharashtra) [India], Feb 25 (ANI): The transit retail market in India is expected to grow from 2.2 billion dollars now to 21.6 billion dollars by 2030, according to a new study by international property consultancy Knight Frank India.
While the retailing potential is best tapped at airports, it is still at a nascent stage for other modes like metros, railways, highways and bus stations, said the study titled 'Catch Them Moving.'
A large part of the retail opportunity at transit hubs is currently untapped due to lack of retail infrastructure at these nodes.
But it will grow manifold in the new decade due to potentially healthy growth in passenger traffic and transport infrastructure.
The large retail potential translates into lease rental opportunity of one billion dollars currently, which is estimated to grow to 3.2 billion dollars by 2030.
Considering the current lease rent opportunity, the government can potentially monetise these transit-oriented retail assets to generate funding to the tune of 10 billion dollars.
Such monetisation will reduce dependencies on passenger tariffs and develop the retail eco-system for largely unexplored territory. This will also open a new revenue stream for future infrastructure developments.
"India is going through an infrastructure revolution," said Shishir Baijal, Chairman and Managing Director of Knight Frank India.
The government's focus on developing and modernising the transport modes including airports, railway stations, metro and highways is opening up unprecedented opportunities for the organised retail segment in India, he said in a statement on Tuesday.
"The development of retail infrastructure at key transportation nodes through a public-private partnership has presented huge opportunities to operators and retailers to monetise the potential of guaranteed footfalls with the wait time," said Baijal.
Retail real estate growth has by far been the most sensitive to domestic and global conditions. With organised retail still only a fraction of the total retail market in India while having the largest population base, there is ample scope of growth in the country.
Most of the organised retail growth in India so far has been based out of mall developments with sales heavily dependent on footfalls and conversions thereafter.
"The advent of transit retail will provide retailers with a captive audience that is willing to spend. The transport hubs will have to create appropriate space with prominence and visibility, smart revenue models and correct product mix to ensure that retailers see value in their presence in a transport hub," said Baijal.