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Office space leasing across India's seven largest cities increased modestly over the year, supported by sustained demand from domestic and foreign companies, as per Colliers India. Total gross leasing of Grade A offices touched 71.5 million sq ft, higher than the previous year. Growth was led by strong absorption in cities such as Bengaluru, Chennai and Delhi-NCR, while Mumbai and Hyderabad saw some moderation. Technology firms, BFSI players and global capability centres continued to drive demand, with flexible workspace operators also expanding their footprint.
Office space leasing across India's top seven cities rose 6 per cent over the year to 71.5 million sq ft, reflecting stable demand from both Indian and overseas companies, according to data released by Colliers India during the past week. The consultant indicated that momentum in the office market is likely to remain firm in the coming year, supported largely by expansion in the technology and banking, financial services and insurance segments. Advertisement
Gross leasing of Grade A office spaces increased from 67.2 million sq ft in the previous calendar year to 71.5 million sq ft. The figures account only for completed leases and exclude renewals, pre-commitments and transactions where only a letter of intent was signed.
City-wise trends showed mixed performance. Leasing activity declined in Mumbai and Hyderabad, while the remaining five cities Bengaluru, Chennai, Pune, Kolkata and Delhi-NCR reported year-on-year growth. Bengaluru retained its position as the largest office market, with leasing rising 2 per cent to 22.1 million sq ft. Chennai recorded one of the sharpest increases, with absorption jumping 41 per cent to 9.6 million sq ft.
Delhi-NCR also saw healthy growth, with office leasing increasing 16 per cent to 11.3 million sq ft. Pune posted a 37 per cent rise in demand to 7.8 million sq ft, indicating continued interest from occupiers in the city. Kolkata, though smaller in scale, witnessed a 38 per cent increase, with leasing touching 1.1 million sq ft.
In contrast, Hyderabad saw a 19 per cent decline in office leasing to 10.1 million sq ft, while Mumbai registered a marginal 5 per cent drop to 9.5 million sq ft. Market participants have attributed the softer performance in these cities to cautious occupier decisions and selective space consolidation.
Colliers noted that global capability centres have emerged as a key driver of office demand in recent years. Foreign companies continue to set up GCCs in India, drawn by the availability of skilled talent and access to quality office spaces at relatively competitive rentals. Corporates are also increasingly opting for a mix of conventional offices and managed workspaces offered by coworking operators.
Flexible workspace providers accounted for about 13 million sq ft of the total leasing during the year. These operators typically lease large office spaces, set up their own centres and then sub-lease workstations to corporate clients, a model that has gained acceptance since the pandemic period.
Source PTI
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