Wednesday, 4 March 2026
India’s office real estate market closed 2025 on a strong note, with record leasing activity across major cities and sustained demand from global and domestic occupiers. Market data from leading property consultancies indicate that 2025 marked the highest annual office leasing volume on record, positioning the sector for continued momentum in 2026.
Gross office leasing across India’s top cities exceeded 80 million square feet in 2025, surpassing previous annual highs. The final quarter of the year recorded particularly strong activity, with several markets reporting their best quarterly performance to date.
Bengaluru led national leasing volumes, followed by Delhi NCR, Hyderabad and Mumbai. These cities continued to attract multinational corporations, technology firms, financial institutions and Global Capability Centres (GCCs), which remained one of the largest contributors to overall absorption.
Net absorption also rose significantly year-on-year, reflecting steady occupier expansion rather than purely consolidation-driven transactions.
Demand in 2025 was supported by a diversified occupier base. GCCs accounted for a substantial share of total leasing, particularly in Bengaluru and Hyderabad, while technology and banking, financial services and insurance (BFSI) firms remained active across major hubs.
Flexible workspace operators continued to play a growing role in the ecosystem, accounting for a notable share of transactions in certain quarters. Many occupiers used flex space as a transitional or complementary solution alongside long-term campus commitments.
New completions across the top seven office markets remained substantial, but absorption levels helped maintain overall vacancy stability in prime micro-markets. High-quality, Grade A buildings in established corridors continued to attract strong interest, especially those offering sustainability certifications and modern amenities.
Rental growth was observed in select prime sub-markets, particularly in Bengaluru, Hyderabad and parts of Delhi NCR. Yield levels in core office assets remained broadly stable, typically in the 8–8.5 percent range, reflecting investor confidence in India’s office fundamentals.
Bengaluru continued to dominate both supply and leasing volumes, with large campus transactions and strong pre-leasing activity in upcoming developments. Hyderabad saw significant pipeline concentration in western corridors such as Gachibowli and Madhapur, supported by competitive rental levels relative to other metros.
Delhi NCR recorded improving occupancy levels, particularly in Gurugram and select Noida sectors, where a portion of upcoming supply is already pre-committed. Pre-leasing trends across key markets suggest that occupiers are securing space well ahead of project completion to lock in pricing and ensure availability.
Industry observers expect 2026 to build on the momentum of 2025, supported by India’s continued positioning as a global operations hub. Occupiers are increasingly combining long-term campus strategies with flexible workspace components to manage workforce fluctuations.
Sustainability considerations are becoming more central to leasing decisions, with companies prioritising energy-efficient buildings and environmentally aligned workspaces.
While global economic conditions and geopolitical developments remain factors to monitor, the overall trajectory of India’s office market points toward sustained demand, stable yields and continued institutional interest in high-quality commercial assets through 2026.
Source: CIJ.World India Research & Analysis Team
