Gucci, Cartier and Louis Vuitton are among brands to sign leases for stores in Indian tycoon Mukesh Ambani's new Mumbai mall, as luxury firms and Reliance Industries seek to profit from strong economic growth and a rapid rise in the number of millionaires.
The Jio World Plaza, which an industry source said is likely to open this year, is located inside Reliance's $1 billion business and cultural hub in Mumbai's business district.
Reliance has yet to disclose details about the tenants, but lease documents provided by real estate analytics firm CRE Matrix showed that Burberry Group as well as several brands owned by LVMH, Kering and Richemont have agreed to rent shops in the mall, and also share between 4 per cent and 12 per cent of their monthly net revenue with Reliance.
The brands include jewellers Cartier and Bulgari, fashion houses Louis Vuitton, Dior and Gucci, watch brand IWC Schaffhausen and luxury luggage maker Rimowa, which will open its first outlet in India.
Reliance, Burberry, LVMH, Kering and Richemont did not respond to a request for comment.
"Luxury brands have always struggled for quality retail spaces in India and many were forced to open their first outlets in luxury hotels," said Anuj Kejriwal, CEO of India's Anarock Retail. "These brands are now looking for meaningful presence."
At almost 700 square metres, Louis Vuitton's Jio World Plaza store will be the most spacious of its four outlets in India. Cartier's store will be its second in the country and for Dior, it will be the third.
To ensure the mall retains its luxury appeal, some lease agreements like that of Dior include a clause that entitles it to a 25 per cent rent reduction if at least four of 10 luxury brands including Gucci, Cartier, Bulgari and Tiffany don't open their own outlets in the mall within six months.
India's 1.4 billion population, the world's biggest, has a per capita income of just $2,300, but the country is also home to more than 800,000 dollar millionaires who are splashing out on everything from luxury homes to expensive SUVs.
Real estate consultants Knight Frank estimate India will have 1.4 million millionaires by 2026, 77 per cent more than in 2021, as the economy continues to strengthen.
The growth in India, where Euromonitor estimates the personal luxury market to expand almost 12 per cent a year in 2022-2026 to nearly $5 billion, contrasts with the slowing economy in China, whose appetite for designer goods has driven sales growth in luxury firms for years.
China's personal luxury market will grow an average 11.5 per cent in the four years to 2026 to $107 billion, Euromonitor data shows.