While retail spaces such as outlet malls are already popular, particularly in Punjab, real estate experts said the trend is emerging as a pan-India phenomenon. Also, foreign outlet developers are also exploring ways to introduce global formats in India, they added.

In February, restate developer Pacific Group unveiled Delhi’s first outlet mall in Jasola. It hosts discounted stores for brands like Gant, Tommy Hilfiger, Calvin Klein, Lacoste, Skechers, Adidas, and Birkenstock, and is running at almost full occupancy. At the launch, the mall had over 74 premium brand outlets and a large cinema hall.

Abhishek Bansal, executive director of Pacific Group, said India always had small catchments with discounted stores, but dedicated, organized outlets were missing from India’s retail landscape.

The mall in Jasola spanning 300,000 sqft has both value and bridge-to-luxury brands. However, Bansal anticipates a churn in brand mix within 12 to 24 months, with more focus on up-market brands.“We are 100% occupied, and getting queries from more brands. We are trying to position it more as a premium outlet. We would like to up our game slowly and in 12-24 months, we will see changes and churn in brands.”

To be sure, outlet malls are quite popular with locals and tourists in Canada, Europe and the US. The malls are located usually on the outskirts of cities, spanning high-end luxury to mid-market labels, selling dated inventories at steep discounts.

Although at a nascent stage in India, the outlet centres are cashing in on changing lifestyle and aspirational choices of the young, affluent, and well-travelled Indians, real estate consultant JLL said in a report in September. Premium outlets could be a good alternative for landowners or developers looking to create a differentiated product, however optimal brand mix and mall size are the crucial parameters, it added.

Meanwhile, brands said outlets are important part of store network as they help liquidate old stocks without impacting the brand. “Arvind Fashions has 100 plus stores in India and is planning 20-25 stores a year. Maintaining stock health of the brand and allowing consumers to get older season stocks at a good value in good shopping environment pays,” said a spokesperson for Arvind Fashion, which operates a portfolio of six brands, including Tommy Hilfiger and Clavin Klein.

According to Sushil Dungarwal, a retail and shopping mall specialist working with a few developers to help create large format outlet malls, off highways in south and north India, eight outlet malls are operational in Punjab, but 50-100 km away from main cities off highways. “Earlier they were opening sporadically but now there is a clear shift,” said Dungarwal.

Improved accessibility along India’s highways as well as a rise in vehicle ownership could aid the development of hundreds of such developments within five years, with more realty developers looking at converting land across highways into retail formats, Dungarwala added.

Rahul Arora, head of office leasing advisory and retail services, India at JLL, said large global players are exploring opportunities in India’s outlet mall market. With more consumers buying into branded clothing and moving up to better and more expensive brands Arora expects more brands to set up stores in outlet malls.

Bansal said the market is at a nascent stage and developers must be careful of tenant mix as rentals will be lower compared to established malls.