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India’s commercial office market continues to power ahead in 2025, defying global headwinds and sectoral slowdowns. The latest ANAROCK Research data shows that office rentals, leasing, and new completions have all risen across the top seven cities, signalling steady demand and investor confidence.
Average monthly rentals in India’s major office hubs climbed by 6% in the first nine months of 2025, from about Rs. 85 per sq. ft. in the same period last year to Rs. 90 per sq. ft. now. Bengaluru led the charge with a 9% increase, reaffirming its position as the country’s top commercial real estate market.
At the same time, office vacancy levels dropped from 16.7% in 2024 to 16.2% in 2025, showing that supply is being steadily absorbed. Chennai recorded the lowest vacancy rate at 8.9%, highlighting its balanced demand-supply environment and strong leasing momentum.
Demand Holds Despite Global Uncertainty
What makes these figures remarkable is that they come amid a year marked by global uncertainties, geopolitical tensions, shifting trade policies, and even job cuts in the IT and tech sectors. Yet, India’s office demand has remained resilient, supported by strong domestic growth, the expansion of Global Capability Centres (GCCs), and the rise of flexible workspaces.
Net office absorption across the top seven cities rose by an impressive 34%, from about 31.31 million sq. ft. in 9M 2024 to nearly 42 million sq. ft. in 9M 2025. This is the highest level of office space take-up seen in recent years, and 30% higher than the same period in 2019, when office demand was at a pre-pandemic peak.
Among individual markets, Pune was the clear outperformer, witnessing an extraordinary 97% rise in net office absorption, from 3.14 million sq. ft. last year to around 6.2 million sq. ft. this year. Bengaluru maintained its leadership with the highest overall leasing at 9.95 million sq. ft., followed by Delhi-NCR with 8.2 million sq. ft. and the Mumbai Metropolitan Region (MMR) with 6.6 million sq. ft. Kolkata was the only city to record a dip, with a 19% decline in net office leasing.
GCCs Fuel the Growth
Industry experts point to the rising presence of Global Capability Centres (GCCs) as a major catalyst for this growth. These centers—global offices set up by multinational firms to manage operations, R&D, and digital services are expanding rapidly in India’s Tier I and Tier II cities.
“Multiple factors are driving office space demand despite global headwinds. GCCs remain a major driver of leasing activity in the top seven cities,” says Anuj Puri, Chairman of ANAROCK Group. “Out of the total gross leasing of 58.28 million sq. ft. in 9M 2025, over 40%, about 23.34 million sq. ft. came from GCCs alone.”
Bengaluru remains the undisputed favourite for GCCs, accounting for about 8.3 million sq. ft. of their total leasing. Pune followed with 3.73 million sq. ft., while Chennai registered 3.57 million sq. ft. These figures underscore how India’s tech-driven cities are becoming global backbones for enterprise operations.
A Shift Toward Quality and Sustainability
Puri adds that companies are becoming increasingly selective about where and how they operate. “Firms today are prioritizing high-quality Grade A office spaces that offer better infrastructure, sustainability features, and employee well-being,” he explains. “This has raised the bar for both demand and supply. Developers are aligning new projects with these evolving preferences.”
The rise of green-certified and energy-efficient buildings reflects a clear shift toward sustainability in the commercial real estate market. Occupiers are seeking offices that not only support productivity but also meet environmental goals and align with global ESG standards.
New Office Completions on the Rise
On the supply side, new office completions across the top seven cities rose 15% during the period, from around 34.07 million sq. ft. in 9M 2024 to 39.21 million sq. ft. in 9M 2025. Pune once again led with an astounding 168% increase in new office space, a sign of how rapidly it is emerging as India’s next major business hub.
Bengaluru continued to contribute the largest share of total new supply at about 10.41 million sq. ft., followed closely by Pune at 9.2 million sq. ft. In contrast, Hyderabad and MMR saw yearly declines in new completions of 39% and 41% respectively, indicating some supply moderation in these markets.
Sector-Wise Trends: IT and Co-working Dominate
The IT and ITeS (Information Technology and IT-enabled Services) sector continued to be the single largest consumer of office space, accounting for 27% of total leasing activity. However, this share was marginally lower than last year’s 28%, reflecting a gradual diversification in occupier profiles.
Coworking and managed office operators came next with a 23% share, up from 21% in 2024. This segment’s steady rise shows how the flexible workspace model has moved beyond startups and freelancers to include larger enterprises adapting to hybrid work structures.
The BFSI (Banking, Financial Services, and Insurance) sector followed with an 18% share of total leasing. Other contributors included manufacturing, healthcare, and e-commerce firms, which are increasingly establishing regional offices to serve expanding customer bases.
The Flexible Future of Work
Post-pandemic, the way companies view office spaces has changed dramatically. The demand for flexibility, scalability, and cost efficiency is now central to real estate planning. Many firms, especially in technology and consulting, are adopting hub-and-spoke models—where smaller offices in secondary cities complement larger headquarters in metro hubs.
This trend has spurred the rapid growth of coworking operators, who offer ready-to-use, plug-and-play offices with short lease commitments. For companies balancing remote and in-person work, these spaces provide the right mix of convenience and agility.
A Market Built on Stability
India’s office real estate market has emerged as a pillar of stability amid global uncertainty. Strong domestic consumption, favorable demographics, and a growing services economy continue to attract both domestic and international occupiers.
With rentals rising moderately, vacancies easing, and new supply keeping pace, the fundamentals of the commercial sector remain sound. If this momentum continues, 2025 could well be remembered as the year India’s office market reaffirmed its long-term resilience and global competitiveness.
