Hyderabad recorded its highest-ever first-half office leasing volume of 7.5 million sq. ft. in H1 2026. GCCs accounted for 45% of total leasing, while vacancy levels fell to 11.5% and office rents increased by 7%. The city’s residential market also remained stable with steady sales and launches.
Hyderabad’s commercial office market delivered its strongest first-half performance on record in H1 2026, with office leasing reaching 7.5 million sq. ft., according to Knight Frank India’s latest India Real Estate: Residential and Office (January–June 2026) report. The figure represents a 29% year-on-year increase from 5.9 million sq. ft. recorded during the same period last year, highlighting the city’s growing importance in India’s office real estate landscape.
The surge in leasing activity reflects sustained occupier confidence, particularly from multinational companies expanding their operations in India. As businesses continue to prioritise high-quality office environments and long-term growth strategies, Hyderabad has emerged as one of the country’s preferred destinations for corporate expansion.
GCCs Continue to Power Market Growth
Global Capability Centres (GCCs) remained the biggest driver of office demand during the first half of the year. The sector leased 3.4 million sq. ft., accounting for 45% of total office absorption, compared with 40% in H1 2025. The continued expansion of GCCs reflects Hyderabad’s strong talent pool, well-developed business ecosystem, and growing reputation as a hub for technology, engineering, financial services, and innovation.
The increasing share of GCC leasing also points to a broader shift in corporate real estate strategies. Companies are investing in long-term office footprints while adopting flexible workplace models that support collaboration, operational efficiency, and business continuity. This trend continues to strengthen demand for premium Grade A office developments across the city.
Healthy Demand Keeps Vacancy Under Control
Hyderabad also witnessed a healthy addition of new office supply during H1 2026, with 3.0 million sq. ft. of office completions entering the market. Despite this fresh inventory, occupier demand remained strong enough to absorb much of the new space.
As a result, the city’s office vacancy rate declined by 296 basis points year-on-year to 11.5%, indicating a balanced demand-supply environment. Tightening vacancies also contributed to rental growth, with the average transacted office rent rising 7% year-on-year to ₹80 per sq. ft. per month. Rising rentals alongside falling vacancies highlight the continued strength of Hyderabad’s commercial real estate market.
Residential Market Remains Stable
Beyond commercial real estate, Hyderabad’s residential sector also delivered a stable performance during the first half of 2026. Housing sales reached 19,249 units, registering a modest 1% year-on-year increase, while new residential launches stood at 20,466 units, reflecting a slight 2% decline compared to last year.
The latest Knight Frank India report suggests that Hyderabad continues to maintain healthy market fundamentals across both office and residential segments. With record leasing activity, an expanding GCC presence, rising rents, and controlled vacancy levels, the city remains well-positioned to attract future investment. As businesses continue to expand and workplace strategies evolve, Hyderabad is expected to remain one of India’s leading commercial real estate destinations.
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