Experiential Retail Dominates Malls: F&B and Entertainment Lead Leasing

Indian malls are undergoing a fundamental transformation, shifting their focus significantly towards experiential retail categories like food & beverage (F&B) and entertainment. These segments now collectively command a substantial 32% of mall leasing space in H1 2026, marking a considerable rise from just 20% in 2020.

This strategic pivot is a direct response to evolving consumer expectations, with people increasingly seeking diverse experiences beyond traditional shopping. Developers are actively aiming to draw visitors more frequently and for extended durations, adapting to a retail landscape reshaped by online shopping.

Key Numbers: The Experiential Shift

• F&B and entertainment categories now occupy 32% of mall leasing space in H1 2026.
• This represents a notable increase from 20% in 2020, highlighting a rapid reorientation.
• Entertainment, encompassing cinemas and gaming, has more than doubled its share to 17%.
• F&B alone has grown to command 15% of the total leased area.
• Fashion remains the largest category at 33%, a slight decrease from 35% in 2020.
• The most significant decline hit department stores and hypermarkets, plummeting from 14% to just 4%.

Anuj Kejriwal of Anarock Group confirmed entertainment as the fastest-growing category, reaching its highest sustained share of 17% since a post-Covid surge in 2022. This underscores the industry’s recognition that malls must offer more than just transactional retail.

Industry Voices Confirming the Trend

• Shibu Philips of LuLu Group India noted their F&B space has nearly tripled since 2013 to 28%, featuring larger food courts and international cuisines.
• Entertainment and leisure also make up 15-20% of LuLu Group’s mall space, integrating gaming centers and indoor adventure parks.
• Upcoming malls are projected to allocate over 50% of their space to non-traditional retail.
• Elan Group’s properties in Gurugram have seen a nearly fourfold increase in footfall, largely attributed to enhanced F&B offerings.
• Industry leaders like Satyajit Dhingra of Impresario Entertainment & Hospitality and Vikrant Batra of Batra Bros emphasize F&B’s crucial role in shaping the mall experience.

The adaptation extends to specific offerings, with PVR INOX reporting strong admissions, affirming cinemas as vital social destinations. KidZania India, exclusively located in malls, sees average dwell times of 5-10 hours, demonstrating demand for immersive family experiences.

Beyond Retail: New Entertainment Avenues

• TEEG India, operating Timezone and Play ‘N’ Learn, expanded traditional arcades to include bowling, laser tag, and virtual reality.
• Even physical retail stores, such as Decathlon, are incorporating experience zones to build customer trust and facilitate product testing.
• Despite these shifts, fashion continues to serve as a key anchor for malls.
• DLF Retail consistently reports double-digit footfall growth across its portfolio, showcasing the continued draw of these evolving spaces.

This comprehensive shift signifies that malls are strategically positioning themselves as vibrant social and entertainment hubs. By diversifying their offerings, they ensure continued relevance and traffic, creating destinations that online shopping simply cannot replicate while maintaining the foundational role of fashion retail.