India’s commercial office market closed 2025 on a strong footing, with net office leasing crossing 61 million square feet across the country’s eight largest urban centres. The sharp year-on-year rise signals renewed occupier confidence, underpinned by steady economic growth, expanding Global Capability Centres, and sustained investment in urban infrastructure.
Data compiled from market assessments indicates that office absorption increased by roughly one-quarter compared to the previous year, reflecting a broad-based recovery rather than a narrow rebound. Southern and northern markets emerged as clear outperformers, while select western cities experienced moderation as occupiers reassessed cost structures and workplace strategies. Chennai recorded one of the most pronounced expansions, driven by a combination of manufacturing-linked services, technology back offices, and improved regional connectivity. Urban planners note that the city’s ability to offer relatively affordable Grade A office stock, along with access to skilled talent, has strengthened its appeal to both domestic firms and multinational tenants. Delhi-NCR also posted strong gains, supported by sustained demand from professional services, technology firms, and enterprise support functions. The region’s evolving office clusters, improved metro connectivity, and continued commercial redevelopment have helped distribute demand beyond traditional business districts, easing congestion while unlocking new employment zones. Bengaluru remained the country’s largest office market by volume, though growth stabilised rather than accelerated. Market observers say this reflects a transition phase, as occupiers consolidate space in mature micro-markets while selectively expanding into emerging corridors with better infrastructure and sustainability credentials.
In contrast, Mumbai saw a softening in net absorption during the year. Analysts attribute this to high occupancy costs, limited availability of large contiguous spaces, and increased scrutiny by occupiers on operational efficiency. Despite this, rental levels remained resilient, suggesting that premium locations continue to command long-term confidence. The leasing momentum was reinforced by robust supply additions, with new office completions reaching record levels. Importantly, vacancy levels tightened across most cities, indicating that demand is keeping pace with supply. This has contributed to moderate rental growth, particularly in markets where infrastructure upgrades and transit-oriented development have reshaped commuting patterns. A notable structural trend has been the continued rise of Global Capability Centres, which now account for a substantial share of office demand. Their expansion has implications beyond real estate, influencing urban employment, public transport usage, and the need for inclusive, people-first commercial districts.
Looking ahead, experts believe India’s office sector will increasingly be shaped by sustainability standards, flexible work formats, and decentralised growth. Cities that align commercial development with climate resilience, public transport integration, and workforce well-being are likely to remain the strongest performers in the next cycle.
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