India's Office Leasing Hits Record 48.9 Mn Sq Ft in H1 2025

India’s commercial real estate sector witnessed a robust resurgence in the first half of 2025, with office leasing across the top eight cities reaching 48.9 million sq ft, marking a 41% year-on-year increase from H1 2024, according to the latest report by Knight Frank India.

The surge in activity reflects strong occupier confidence and continued momentum in the sector, despite broader global uncertainties. Bengaluru emerged as the frontrunner, registering its highest-ever half-yearly absorption at 18.2 million sq ft, more than doubling year-on-year. The report titled India Real Estate – Office and Residential (January – June 2025) was released on July 3.

The report highlighted that Global Capability Centres (GCCs) dominated the demand landscape, contributing 39% of the total office space uptake. In Bengaluru alone, GCCs accounted for 55% of leasing activity. Furthermore, pre-commitments made up 46% of the city’s absorbed space, indicating a growing urgency among occupiers to lock in future office space amid limited ready-to-move-in stock.

The strong performance in H1 2025 has already crossed two-thirds of last year’s total leasing volume of 71.9 million sq ft, setting the stage for a projected record full-year leasing of 80–90 million sq ft.

Among other major cities, Delhi-NCR recorded 7.2 million sq ft in leasing volume, a 27.5% rise year-on-year. Hyderabad and Chennai also performed strongly, registering 16% and 68% growth respectively, with leasing volumes at 5.9 million and 5.1 million sq ft.

Pune saw a 17% rise to 5.1 million sq ft, while Kolkata recorded a significant 60% increase to 1.1 million sq ft. However, Mumbai and Ahmedabad posted negative growth. Mumbai’s leasing fell 5% to 5.5 million sq ft, and Ahmedabad experienced a sharp 51% drop to 0.8 million sq ft, attributed largely to a high base effect rather than a market slowdown.

While demand remained robust, new office space completions fell by 20% year-on-year, amounting to 20.1 million sq ft. Knight Frank attributed this dip to developers’ prior focus on the booming residential sector, though interest is now gradually shifting back to commercial developments.

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Commenting on the market’s performance, Shishir Baijal, Chairman and Managing Director, Knight Frank India, stated, “The Indian office market scaled another record high in H1 2025, recording a remarkable 42% YoY growth. This performance is a testament to India’s resilient economic fundamentals and its growing prominence as a global business hub.”

With India’s rising strategic appeal, occupier demand, and investor confidence, the commercial real estate market is well-positioned for continued growth through the remainder of the year.