India’s office market is defying regional trends, with Bengaluru, Delhi-NCR, and Mumbai expected to hit a record 50 million sq. ft in office leasing in 2025, according to Knight Frank. GCCs and IT firms are driving demand as rents rise 4.3% YoY despite new supply and global headwinds.
India’s commercial real estate continues to outperform, with Bengaluru, Delhi-NCR, and Mumbai leading a robust recovery in leasing and rent growth. Knight Frank’s Asia-Pacific Office Highlights Q3 2025 report reveals that India’s office leasing is poised to touch 50 million sq. ft in 2025 — breaking the previous record of 41 million sq. ft in 2024.
This growth stands in contrast to the broader Asia-Pacific region, where average prime office rents declined 1.4% year-on-year. Of the 23 cities monitored, only 16 saw rents remain stable or rise, underscoring India’s resilience and competitive position amid regional uncertainty.
Sustained Growth Amidst Rising Supply
Despite an influx of nearly 9 million sq. ft of new supply during the July–September 2025 quarter, prime office rents in India’s top three markets grew by an average of 4.3% year-on-year. Leasing momentum remained strong, with 8.8 million sq. ft transacted in Q3 alone. Knight Frank attributes this strength to steady occupier demand, led primarily by Global Capability Centres (GCCs) and expanding third-party IT services.
Vacancy rates remain healthy — 11.5% in Bengaluru, 12.5% in Delhi-NCR, and 17.3% in Mumbai — reflecting a stable equilibrium between supply and demand.
City-Wise Momentum: Bengaluru Takes the Lead
Bengaluru remains the country’s star performer, with strong absorption in corridors such as Outer Ring Road and Whitefield. The city’s prime rents rose 2% quarter-on-quarter and 8.8% year-on-year. Central business districts continue to command premium rates, with Bengaluru’s CBD averaging ₹1,807 per sq. ft annually, Mumbai’s BKC at ₹3,953, and Delhi’s Connaught Place at ₹4,200.
Delhi-NCR and Mumbai followed with steady growth — both recording a 2% QoQ increase and around 3–4% YoY gains, reinforcing steady demand across India’s major hubs.
GCCs and IT Revitalising Leasing Activity
According to Knight Frank, the expansion of Global Capability Centres and the revival of IT services have been pivotal in driving India’s office market resurgence. GCCs are increasingly establishing and enlarging their footprint across both Tier-I and emerging Tier-II cities.
Shishir Baijal, Chairman and Managing Director of Knight Frank India, emphasised,
“India’s office market continues to stand out as a beacon of stability and long-term potential amid regional uncertainty. The strong leasing activity underscores the country’s growing importance in global business strategies. With GCCs expanding and renewed activity in the IT sector, India is becoming a hub for dynamic, tech-driven office spaces that reflect flexible and hybrid working models.”
Outlook: Momentum to Continue Through 2026
Knight Frank projects sustained rental growth through 2026, driven by government-led digital initiatives, continued GCC expansion, and the growing integration of technology in the workplace. With Grade-A offices and hybrid-ready environments in high demand, India’s commercial real estate is evolving into a resilient and investor-friendly ecosystem.
As Baijal noted, the country’s consistent leasing activity, controlled vacancy levels, and robust demand fundamentals “signal a new phase of growth” for India’s office market — one that sets it apart from the rest of Asia-Pacific.
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