India’s office market closed 2025 on a stable note with 75.2 million sq. ft. of leasing, led decisively by Bengaluru. The city emerged as the top market, driven by strong GCC activity, technology demand, and flexible workspaces, alongside Delhi-NCR and Mumbai. A robust supply pipeline points to cautious optimism for 2026.
India’s office leasing market demonstrated notable stability in 2025, with gross absorption touching 75.2 million sq. ft. across six major cities. According to a new report by Savills India, leasing activity remained largely in line with the previous year, underscoring the sector’s resilience despite ongoing global economic and geopolitical uncertainties. The data reflects only fresh lease transactions, excluding renewals and pre-commitments, offering a clear view of real-time occupier demand.
Top Three Cities Drive Majority of Demand
Bengaluru continued its leadership position, recording 20.2 million sq. ft. of office absorption during the year. Delhi-NCR followed with 13.6 million sq. ft., while Mumbai accounted for 12.1 million sq. ft. Together, these three markets contributed nearly 61% of India’s total leasing activity in 2025, reinforcing their status as the country’s primary commercial real estate hubs.
Other major markets also posted healthy numbers. Hyderabad saw 11.4 million sq. ft. of leasing, Chennai recorded 9.1 million sq. ft., and Pune added 8.8 million sq. ft. Hyderabad stood out for its strong Global Capability Centre (GCC) activity, with such occupiers accounting for 43% of the city’s total absorption.
GCCs and Flex Spaces Remain Key Growth Engines
The report highlights that demand was largely driven by GCCs, technology firms, and BFSI players. The IT-BPM sector alone accounted for 33% of total leasing, while flexible workspaces captured 15%, reflecting continued enterprise adoption of managed and flex office models.
“Despite global uncertainties, India’s office market ended 2025 on a firm and resilient note. The momentum was led by new entrants and expansionary demand from GCCs,” said Naveen Nandwani, MD, Commercial Advisory and Transactions, Savills India.
Bengaluru, while leading overall absorption, saw leasing volumes moderate by around 12% year on year. This slowdown was attributed to calibrated expansion strategies by occupiers and delayed deal closures amid a cautious global outlook.
Supply Pipeline Expands, Vacancies May Edge Up
On the supply side, India added 58.2 million sq. ft. of new office space in 2025. Savills projects this figure to rise sharply to 90.8 million sq. ft. in 2026, pointing to a strong development pipeline across key markets. As a result, overall Grade A office stock stood at 846.9 million sq. ft. in 2025 and is expected to reach 937.7 million sq. ft. next year.
Looking ahead, Savills expects demand to remain steady at around 75 million sq. ft. in 2026. While increased supply could lead to a marginal rise in vacancy levels, it will also give occupiers access to newer, higher-quality assets. “Rental growth is expected to remain largely range-bound, with limited upside in select micro markets,” Nandwani added.
Outlook: Stable Demand, Selective Growth
Overall, India’s office market enters 2026 on a solid footing. With GCCs, technology, BFSI, and flexible workspace operators continuing to drive absorption, the sector is poised for steady, if measured, growth—balancing occupier caution with long-term confidence in India’s commercial real estate fundamentals.
