India's office market is experiencing exceptional growth, with leasing activity in the top eight cities rising by 74% in the January- March 2025 quarter. The gross leasing of office space reached an all-time high of 282 lakh square feet during Q4 FY25, driven by strong demand from global capability centres (GCCs), the BFSI (banking, financial services, and insurance) sector, technology firms, and data center businesses.
Bengaluru Leads Growth in Office Leasing
Among the eight major cities, Bengaluru saw the most dramatic increase, with office space leasing more than tripling to 127 lakh square feet during the January- March 2025 period, compared to 35 lakh square feet in the same quarter the previous year. Notably, 58% of the office space leased in Bengaluru was accounted for by pre-commitments, indicating strong confidence from businesses in the city’s commercial real estate market.
This surge in leasing activity underscores Bengaluru's position as a key hub for GCCs, which are driving much of the demand for office spaces in India. With a thriving tech ecosystem, Bengaluru continues to attract global businesses looking to establish or expand their operations in India.
Other Cities Experience Significant Growth
In addition to Bengaluru, other major cities also recorded strong growth in office leasing. Hyderabad saw a 31% rise in leasing activity, reaching 40 lakh square feet, up from 30 lakh square feet in the previous year. Pune experienced an impressive 91% increase in demand, with office space leasing jumping from 19 lakh square feet to 37 lakh square feet.
Mumbai also saw a solid 24% increase in office leasing, with 35 lakh square feet transacted, compared to 28 lakh square feet in the same period last year. Chennai experienced a 56% increase in leasing, with 18 lakh square feet of office space leased, up from 12 lakh square feet.
Challenges for Delhi-NCR, Ahmedabad, and Kolkata
Despite the overall growth in India’s office leasing market, some cities faced a decline in demand. Delhi-NCR saw a notable 33% drop in leasing activity, with only 21 lakh square feet leased, compared to 31 lakh square feet in the same quarter of 2024. Similarly, Ahmedabad’s office leasing dropped 54%, from 5 lakh square feet to just 2.2 lakh square feet, while Kolkata witnessed a 16% decrease, with leasing falling to 1.6 lakh square feet from 2 lakh square feet in the previous year.
The decline in Delhi-NCR’s office leasing is particularly noteworthy, as the region has historically been one of the largest office markets in India. This drop could be attributed to a variety of factors, including economic uncertainty and shifting demand for office space in other cities.
GCCs Drive Leasing Activity
The demand for office space in India is increasingly being driven by global capability centres (GCCs), which accounted for a substantial 124 lakh square feet of leasing in the January- March 2025 period, compared to 50 lakh square feet in the same quarter last year. GCCs, often established by multinational companies to manage operations in India and the surrounding region, continue to drive demand for high-quality office spaces.
As businesses scale and adapt to new work styles, the demand for well-connected, amenity-laden office spaces continues to grow, further cementing India’s position as a global hub for enterprise, technology, and innovation.
Outlook for India’s Office Market
The growth in office space leasing in India highlights the country’s continued appeal as a long-term investment destination, especially for global firms looking to establish or expand their presence in Asia. As demand from GCCs, tech firms, and other sectors continues to rise, India’s office market is poised for continued growth in the coming quarters.