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India is approaching a landmark transformation in its commercial real estate journey, as it inches closer to 1 billion square feet of office space by the third quarter of 2025. According to a recent Knight Frank India report, this positions the country to soon become the world’s fourth largest office market, driven by economic strength, attractive rental values, and sustained demand from global occupiers.
A Two-Decade Leap: From 200 Million to Nearly 1 Billion Sq Ft
India’s commercial office sector has evolved significantly over the last 20 years. From having just under 200 million sq ft of space in the early 2000s, the country has expanded to 993 million sq ft as of June 2025 reflecting a compound annual growth rate (CAGR) of 8.6%.
This growth has been fuelled by policy reforms, steady infrastructure development, and increasing global investor interest. Knight Frank attributes this momentum to government-led initiatives like SEZ policies, digital transformation, and the formalisation of the economy.
As India’s office sector matures and institutional investments grow, the milestone of seeing India become world’s fourth largest office market seems within reach.
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Key Growth Cities: Bengaluru, NCR, and Mumbai Lead
Three metro cities form the core of India’s commercial real estate story:
- Bengaluru leads with 229 million sq ft
- National Capital Region (NCR) follows with 199 million sq ft
- Mumbai Metropolitan Region (MMR) stands at 169 million sq ft
Collectively, they contribute nearly 60% of the nation’s total office stock. Other prominent cities include:
- Hyderabad – 123 million sq ft
- Pune – 106 million sq ft
- Chennai – 92 million sq ft
Ahmedabad and Kolkata round out the remaining 7%, reflecting the centralisation of demand in Tier-1 urban centres.
Premium Spaces Dominate: Rise of Grade A Offices
According to the report, Grade A office spaces known for their modern infrastructure and ESG compliance now account for 53% of India’s total office inventory.
- Bengaluru has the highest share of Grade A offices at 70%
- Hyderabad follows closely with 68%
- Chennai holds 64%
This shift is primarily driven by sectors like IT, financial services, and Global Capability Centres (GCCs), which demand high-efficiency, tech-enabled workspaces.
India’s Rental Advantage: Global Competitiveness Under $1
One of India's greatest advantages in attracting global tenants is affordability. With average office rents at just $0.96 per sq ft per month, India remains one of the few sub-dollar rental markets globally.
This cost-efficiency, combined with world-class infrastructure and growing sustainability compliance, makes India a magnet for multinational companies looking to optimise costs without compromising quality.
Knight Frank notes that global companies are increasingly choosing Indian cities for scalable and green-certified offices that align with global ESG goals.
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Outlook: Another Billion Square Feet by 2041?
Looking forward, India’s commercial sector is projected to double once again reaching 2 billion sq ft by 2041. This will likely be driven by a mix of factors, including:
- Rapid urbanisation
- Digitisation of businesses
- Infrastructure-led economic growth
- Strong demand from global tech and service sectors
The report suggests that India's office market is shifting from a volume-driven model to a value-focused one, prioritising innovation, sustainability, and long-term economic potential.
Conclusion
India’s ascent toward becoming the world’s fourth largest office market reflects more than just impressive square footage it showcases the country’s evolution into a modern, globally competitive real estate hub.
As commercial stock nears the 1 billion sq ft mark, India stands out not only for its affordability but also for the growing sophistication of its office spaces. With a favourable investment climate, rising ESG standards, and deep-rooted demand from global firms, India’s office market is positioned for an exciting, expansive decade ahead.
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Ans 1. As of June 2025, India has reached 993 million square feet of office space and is expected to hit the 1 billion sq ft milestone by Q3 2025.
Ans 2. Bengaluru, NCR (Delhi), and Mumbai lead the market, jointly accounting for nearly 60% of the total stock. Hyderabad, Pune, and Chennai are also major contributors.
Ans 3. Grade A offices offer modern infrastructure, energy efficiency, and ESG compliance. They now make up 53% of India’s total office space and are preferred by IT firms, MNCs, and Global Capability Centres.
Ans 4. India offers premium office spaces at an average rent of just $0.96 per sq ft one of the lowest globally along with strong infrastructure and sustainability credentials.
Ans 5. Over the past two decades, India’s office stock has grown at a CAGR of 8.6%, rising from under 200 million sq ft in the early 2000s to nearly 1 billion sq ft today.
Ans 6. Government-led policies like SEZs, digitisation efforts, and formalisation of the economy have created a more investor-friendly environment, driving demand for commercial real estate.
Ans 7. The market is evolving from just adding volume to focusing on quality, innovation, and ESG compliance, making it more aligned with global standards.
Ans 8. India is expected to double its commercial office stock and cross 2 billion sq ft by 2041, led by tech demand, urbanisation, and infrastructure expansion.