Friday, 2 January 2026
After several years marked by caution and uneven performance, India’s Grade A office market has begun to show clear signs of revival. Leasing activity strengthened noticeably over the course of 2024, reversing the slowdown seen in the immediate post-pandemic period and restoring confidence among occupiers and investors alike. The rebound has been driven by a combination of economic resilience, renewed corporate expansion plans and growing interest from long-term institutional capital.
Office take-up across the country reached some of its strongest levels in recent years, with activity spread across major metropolitan areas rather than concentrated in a single market. This broad-based recovery reflects a shift in sentiment, as companies reassess their space needs and re-engage with physical offices, particularly for collaborative, technology-driven and client-facing functions. Sectors such as information technology, financial services and global in-house operations have played a central role in this renewed demand.
Southern cities have been at the forefront of the recovery. Bengaluru has once again asserted its position as the country’s most active office market, supported by a deep occupier base and continued expansion by multinational firms. Leasing activity has been boosted not only by new requirements but also by renewals and consolidations, indicating a degree of long-term commitment from tenants. Hyderabad has followed a similar trajectory, benefiting from competitive occupancy costs, modern office stock and an improving urban infrastructure that continues to attract both domestic and international occupiers.
In western India, Mumbai has recorded a gradual but steady improvement in office absorption. Demand has been most visible in established commercial districts, where limited availability and strong tenant profiles have helped maintain pricing discipline. The National Capital Region has also contributed meaningfully to the recovery, with Gurugram emerging as a key driver of office demand in North India. Large-format developments and integrated business parks have remained particularly attractive to technology-led occupiers and service providers.
The recovery in leasing has been accompanied by sustained interest from global capital. India’s office assets continue to be viewed as offering relatively compelling income returns when compared with many mature markets, where pricing corrections and structural uncertainty have weighed on investor sentiment. While yields vary across cities and asset classes, the overall risk-return profile of Indian Grade A offices has remained favourable, underpinned by stable occupancy levels and a growing pool of institutional-quality buildings.
Listed real estate vehicles have further strengthened the market’s institutional framework. Office-focused investment platforms now hold a significant share of premium commercial stock, providing investors with access to diversified portfolios and predictable cash flows. The visibility and governance standards associated with these structures have helped broaden the investor base, drawing interest from both domestic savers and international funds.
Foreign sovereign and pension investors have been particularly active over the past few years, increasingly favouring partnerships and platform-based strategies. Their continued presence reflects confidence in India’s long-term economic prospects, as well as in the structural reforms that have improved transparency and reduced execution risk within the real estate sector. Regulatory changes, clearer taxation frameworks and greater formalisation have all contributed to a more investable environment.
Looking ahead, India’s office market appears to have moved beyond its period of adjustment. While occupier preferences continue to evolve and supply remains selective, the underlying fundamentals suggest a market that has regained momentum and depth. For investors and occupiers alike, the current cycle points to a more balanced and mature phase for India’s Grade A office sector, anchored by sustained demand and growing institutional participation.
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