Office space demand in India’s major cities has reached unprecedented levels in the first half of 2024, with gross leasing hitting 33.54 million square feet. This represents a 29% year-on-year increase, according to a recent JLL India report. The cities included in this surge are Delhi-NCR, Mumbai, Kolkata, Chennai, Bengaluru, Hyderabad, and Pune.

The first half of 2024 marked the best-ever performance for office leasing volumes, surpassing previous highs seen in 2019. “H1 2024 (January to June) marked the best-ever first half, with leasing volumes at 33.5 million sq ft, surpassing the previous highest H1 performance seen in 2019,” the JLL report stated. For context, the same period in 2019 saw 30.71 million square feet leased, while the pandemic years of 2020 and 2021 saw significant drops to 21.10 million and 12.55 million square feet, respectively. The resurgence began post-pandemic, with 24.68 million square feet leased in the first half of 2022 and 26.01 million in the same period of 2023.

Gross leasing figures include all lease transactions within the period, such as confirmed pre-commitments, but exclude term renewals and deals still in discussion. This comprehensive measure highlights the robust recovery and growth of the office space market in India.

Bengaluru led the charge in office space demand with the highest leasing volumes among the major cities, closely followed by Delhi-NCR and Mumbai. Notably, flexible workspaces and co-working environments have seen significant uptake, contributing substantially to the leasing figures.

Looking ahead, JLL India projects that 2024 will set a new record for office space leasing, predicting gross leasing volumes to reach 65-70 million square feet. This anticipated milestone underscores the strong momentum in India’s commercial real estate market and reflects a broad-based recovery across multiple sectors.

However, despite the booming leasing activity, investments in office spaces have seen a significant downturn. According to a report by Colliers India, investments in this segment plummeted by 83% in the second quarter of 2024 compared to the same period the previous year. This decline in investment contrasts sharply with the leasing growth, suggesting a cautious approach by investors amid global economic uncertainties.

In summary, the first half of 2024 has been a record-breaking period for office space leasing in India, driven by solid demand across major cities. The projected growth for the rest of the year indicates a robust future for the sector despite the current dip in investment activity. As businesses expand and adapt to new working models, the office space market is poised for continued growth and transformation.