new delhi, July 9 -- Despite a slowdown in urban consumption, retail giants such as Aditya Birla Fashion and Retail Ltd and Tata Group-backed Trent Ltd are pressing ahead with plans to expand their physical footprint. Store additions are projected to grow by 18-20% this fiscal year, with a slight increase anticipated in FY27, according to property consultancy Knight Frank India. In comparison, FY24 saw 9-10% growth, while the previous year reported 14-16%. Demand for real estate will be led by large organised retailers. Meanwhile, tier-two and tier-three cities are expected to drive growth in retail occupancy, while the top seven cities will see availability of Grade A mall supply. Experts say retailers tend to plan store networks with a 10-20 year horizon, locking in prime spaces in anticipation of demand increasing. While discretionary spending, particularly in urban areas, has slowed, consumption is expected to recover aided by a good monsoon, lower inflation, and the recent income tax cut. "Contrary to what people think, that retail expansion has been kept on hold, per our estimates, we anticipate an 18-20% growth in number of store additions this fiscal year; by 2030 this may go up to 25 to 30%," said Abhishek Sharma, senior director, retail agency at Knight Frank India. Over 60 international brands are also expected to enter India by 2030, fuelling demand for quality real estate, he said. "Supply is sufficient for both new and existing brands seeking space," he added. India's retail market is projected to grow to $2 trillion by 2032, up from $705 billion in 2020, per EY estimates. Despite this, organised retail remains under penetrated, leaving ample room for store-led growth.Aditya Birla Fashion and Retail Ltd (ABFRL) has laid out a massive expansion plan. Its value fashion chain Style Up will increase its footprint from 46 to 150 stores in FY26, with a target of 250 over the next 2-3 years. Its men's ethnic wear brand Tasva will scale to 200 stores in the next three years, from 70 now. Meanwhile, its demerged entity Aditya Birla Lifestyle Brands Ltd (ABLBL), which runs over 3,200 stores, is aiming to double in scale in five years, with over 300 new stores in FY26 alone. ABLBL includes brands such as Louis Philippe, Van Heusen, Reebok, and American Eagle. In recent years, brands such as H&M, Uniqlo, and Birkenstock have expanded in the market. Homegrown direct-to-consumer brands like Sugar, The Souled Store, and Mokobara are also charting offline expansion plans. "While metros continue to offer growth opportunities, tier II cities are gaining traction as consumers show a clear preference for shopping at physical stores. This shift is encouraging retailers to expand their brick-and-mortar footprint," said Saurabh Shatdal, executive MD- capital markets & head-retail, India, Cushman & Wakefield. Despite the robust pace of retail expansion, the ongoing demand slowdown-particularly in urban markets-could present some headwinds. According to Shatdal, certain retail categories may experience a relative slowdown due to evolving consumer preferences, market saturation, and operational challenges. "Cinema, for instance, is one category that may see a reduction in their footprint in malls amid declining occupancy levels. Similarly, the growth of quick commerce is reshaping the grocery landscape," he added....