According to Colliers’ latest Asia-Pacific Office Market Insights report, India has emerged as the frontrunner in the Asia-Pacific (APAC) office market, accounting for an impressive 70% of total leasing demand in Q3 2024. This resurgence marks a significant 10.7% year-over-year (YoY) increase in demand for Grade A office spaces across the region, totalling 2.2 million square meters (23.7 million square feet).

India’s Leadership in Leasing Activity

India contributed a staggering 1.61 million square meters (17.3 million square feet) to the APAC office market during Q3, solidifying its role as the region’s powerhouse. Bengaluru and Hyderabad were standout performers, absorbing over half of the country’s total Grade A office space demand. Arpit Mehrotra, Managing Director of Office Services at Colliers India, remarked, “The Indian office market is transitioning to an expansionary phase, with rents expected to firm up further.”

This growth was fueled by strong occupier interest in premium office spaces, leading to annual rental rate increases of up to 10% in key Indian cities. Competitive rental rates and diverse demand from occupier segments have bolstered India’s position in the APAC office landscape.

New Supply Meets Soaring Demand

To match the rising demand, India saw 1.34 million square meters (14.4 million square feet) of new office space completions in Q3 2024, maintaining a stable vacancy rate of 17%. The steady influx of supply ensures balance in the market, allowing India to sustain its growth momentum. Mehrotra noted that India’s rental trends align with other key APAC markets, including Australia, Japan, and New Zealand.

Regional Trends and Future Outlook

While India leads the charge, other APAC markets like New Zealand and Singapore have also reported annual leasing activity growth of over 30%. These figures underscore the broader revival across the region. Despite this upswing, the report highlights that rental rates across the APAC region are expected to remain stable as supply-demand dynamics balance out.

Looking ahead, Colliers anticipates a wave of project completions in prominent markets, further boosting supply in the coming quarters. “India’s strong demand for premium office spaces combined with steady supply growth positions it as a cornerstone of the APAC office market,” Mehrotra added.

Poised for 2025

The Q3 2024 data signals a promising trajectory for the APAC office market in 2025. India’s dominance and strong growth across other regional players reflect a robust recovery and expansion in leasing activity. As occupiers seek high-quality spaces, the APAC region is set for a balanced and dynamic growth phase in the coming years.