Table of Content
- India’s Top Cities Lease Office Space at a Decade-High Pace
- City-Wise Leasing Performance: Winners and Soft Spots
- GCCs Power Office Demand Across India’s Top Cities
- Office Supply Pipeline Expands, But Unevenly Across Markets
- Vacancy Levels Improve as Demand Outpaces New Supply
- Office Rentals Rise as Market Tightens
- Sector-Wise Leasing Trends: IT, Coworking, BFSI Lead
- What This Means for Investors, Developers, and Occupiers
- Outlook for 2026: Is the Momentum Sustainable?
India’s commercial real estate market delivered a resilient performance in 2025, defying concerns around global economic uncertainty, IT sector layoffs, and geopolitical tensions. According to a recent ANAROCK report, India’s top cities are expected to lease office space exceeding 55 million square feet in 2025, marking a robust 10% year-on-year growth compared to 2024.
This surge in leasing activity underscores the structural strength of India’s office market, driven primarily by Global Capability Centres (GCCs), expanding coworking operators, and sustained demand from BFSI and consulting firms. Even as global corporations adopt cautious expansion strategies, India continues to emerge as a preferred destination for long-term office commitments.
India’s Top Cities Lease Office Space at a Decade-High Pace
In 2025, the top seven office markets, Bengaluru, Mumbai Metropolitan Region (MMR), Delhi NCR, Hyderabad, Chennai, Pune, and Kolkata, collectively leased approximately 55.16 million sq ft of office space, up from nearly 49.95 million sq ft in 2024.
This performance is particularly notable given the backdrop of global tariff tensions and technology sector restructuring. The fact that India’s top cities lease office space at such scale highlights the country’s growing relevance in global corporate real estate strategies and its ability to absorb large-scale occupier demand.
Also Read: Interest Rate Cuts Boost Mumbai Affordability; NCR Sees Slight Dip
City-Wise Leasing Performance: Winners and Soft Spots
Bengaluru Remains Largest Market, But Growth Moderates
Bengaluru retained its position as India’s largest office market with net leasing of about 14.15 million sq ft in 2025. However, the city recorded a 5% year-on-year decline, reflecting consolidation among large IT occupiers and increased focus on optimising existing footprints rather than aggressive expansion.
Despite this moderation, Bengaluru continues to anchor India’s office ecosystem, particularly for technology and GCC-led demand.
Pune Emerges as Fastest-Growing Office Market
Pune emerged as the standout performer in 2025. Net office absorption surged 63% year-on-year, rising from 4.8 million sq ft in 2024 to nearly 7.8 million sq ft in 2025.
The city’s growth was driven by a sharp rise in GCC leasing, competitive rentals, improving infrastructure, and strong demand from BFSI and manufacturing-linked services. Pune’s performance reinforces why India’s top cities lease office space growth is no longer concentrated in just one or two metros.
MMR, NCR, Hyderabad, Chennai See Steady Expansion
Other major markets posted healthy gains.
- MMR recorded 8.23 million sq ft of leasing, up 15% YoY
- Delhi NCR leased 10.12 million sq ft, growing 7% YoY
- Hyderabad absorbed 8.11 million sq ft, up 9%
- Chennai saw leasing rise 12% to 5.6 million sq ft
These cities benefited from diversified occupier demand, especially from GCCs, consulting firms, and flexible workspace operators.
Kolkata Sees Marginal Dip but Supply Pipeline Improves
Kolkata was one of the few markets to witness a contraction, with leasing declining 3% to approximately 1.15 million sq ft. However, upcoming supply additions and improving infrastructure are expected to support gradual recovery in the medium term.
GCCs Power Office Demand Across India’s Top Cities
Global Capability Centres emerged as the single-largest growth driver in 2025, accounting for 41% of total office leasing, up from 36% in the previous year. Multinational firms continued to expand their India operations to leverage cost efficiencies, talent availability, and operational stability.
The increasing dominance of GCCs is reshaping how India’s top cities lease office space, with demand shifting towards larger floor plates, technology-enabled campuses, and long-term leasing commitments.
Office Supply Pipeline Expands, But Unevenly Across Markets
New office completions across the top seven cities rose 8% year-on-year to approximately 51.83 million sq ft in 2025. Bengaluru led fresh supply additions with about 13.5 million sq ft, followed by Pune and NCR.
Pune recorded a remarkable 103% jump in new supply, while Chennai and NCR also saw strong increases. In contrast, MMR and Hyderabad experienced declines in new completions, reflecting tighter development pipelines and cautious capital deployment.
Vacancy Levels Improve as Demand Outpaces New Supply
With leasing activity outpacing new supply in several markets, overall office vacancy across the top cities declined to 16.10% in 2025, down from 16.50% a year earlier.
MMR saw vacancy fall to 14.70%, while Hyderabad, despite marginal improvement, continued to report the highest vacancy levels at over 26%. The easing vacancy trend reinforces the depth of demand as India’s top cities lease office space at accelerating rates.
Office Rentals Rise as Market Tightens
Average monthly office rentals across the top cities increased 6% year-on-year to about ₹92 per sq ft in 2025. Bengaluru led rental growth with a 9% increase, followed by Pune and NCR at 6%.
Rising rentals signal improving landlord confidence and underline the strengthening fundamentals of India’s commercial real estate cycle.
Sector-Wise Leasing Trends: IT, Coworking, BFSI Lead
The IT/ITeS sector remained the largest occupier, accounting for 27% of total leasing. Coworking operators followed closely with a 23% share, reflecting sustained demand for flexible office formats.
BFSI firms contributed 18% of leasing, while consulting, e-commerce, and engineering services also expanded their footprints, supporting diversified demand across cities.
Also Read: India Retail Real Estate to Lease 9 Mn Sq Ft in 2025 as Mall Supply Returns
What This Means for Investors, Developers, and Occupiers
For investors, the fact that India’s top cities lease office space at record levels strengthens the investment case for Grade A office assets, particularly those aligned with GCC demand.
Developers benefit from improving rental prospects and declining vacancies, while occupiers gain access to a broader range of high-quality assets across multiple cities, enabling decentralised expansion strategies.
Outlook for 2026: Is the Momentum Sustainable?
Looking ahead, leasing momentum is expected to remain healthy in 2026, supported by India’s economic growth, increasing GCC investments, and rising demand for flexible workspaces. While global risks persist, India’s office market appears well-positioned for steady, demand-led growth.
Conclusion
The strong leasing performance of 2025 marks a defining phase for India’s commercial real estate sector. As India’s top cities lease office space at unprecedented levels, the market is clearly transitioning into a more diversified, resilient, and globally integrated growth cycle, one driven by GCCs, improving fundamentals, and long-term occupier confidence.
Ans 1. India’s office leasing crossed 55 million sq ft in 2025 mainly due to strong demand from Global Capability Centres (GCCs), along with steady expansion by coworking operators, BFSI firms, and consulting companies. Despite global uncertainties, India remains a preferred long-term destination for cost-efficient, talent-driven office operations.
Ans 2. Bengaluru remained the largest office market by absolute leasing volume, followed by Delhi NCR, MMR, Hyderabad, Pune, Chennai, and Kolkata. While Bengaluru led in scale, Pune emerged as the fastest-growing market during the year.
Ans 3. Pune’s sharp growth was driven by increased GCC activity, competitive rentals, improving infrastructure, and demand from BFSI and manufacturing-linked services. These factors made Pune an attractive alternative to more mature office hubs.
Ans 4. GCCs accounted for over 40% of total office leasing in 2025, making them the largest demand driver. Multinational companies continue to expand India-based capability centres due to talent availability, operational stability, and long-term cost advantages.
Ans 5. Overall office vacancy across India’s top cities declined slightly as leasing activity outpaced new supply in several markets. This indicates improving market health, even though some cities like Hyderabad still report relatively higher vacancy levels.
Ans 6. Yes, average office rentals rose across most top cities, reflecting stronger demand and tighter availability of quality space. Bengaluru recorded the highest rental growth, followed by Pune and Delhi NCR.
Ans 7. IT and ITeS companies remained the largest occupiers, followed closely by coworking operators. BFSI firms, consulting companies, and engineering services also contributed significantly, creating a diversified demand base.
Ans 8. Leasing activity is expected to remain strong in 2026, supported by economic growth, continued GCC expansion, and rising demand for flexible workspaces. While global risks persist, India’s office market fundamentals remain resilient.