NEW DELHI: India’s office market achieved its best performance ever in 2025, with net absorption reaching 61.4 million sq ft, a 25% increase compared to the previous year, according to a report by Cushman & Wakefield.
Bengaluru topped the absorption figures at 14.4 million sq ft, representing 23% of total demand. Delhi NCR followed with 10.9 million sq ft (18%). Other cities, such as Mumbai (9.6 million sq ft), Hyderabad (9.1 million sq ft), Pune (8.2 million sq ft), and Chennai (7.0 million sq ft), also showed robust leasing activity. Kolkata and Ahmedabad recorded net absorptions of 1.4 million sq ft and 0.8 million sq ft, respectively. Chennai and Delhi NCR saw the highest year-on-year increases in net absorption, at 187% and 82%, respectively, reflecting strengthening market fundamentals.
Leasing Momentum Continues
Gross leasing volume (GLV) remained steady at about 89 million sq ft, matching last year’s figures and marking the second consecutive year of peak leasing activity. Fresh leasing made up nearly 80% of total leasing for the year, indicating a continued preference among companies to expand operations and secure quality office spaces.
Bengaluru, Mumbai, and Delhi NCR combined for 62% of total leasing activity, with Bengaluru alone accounting for around 22 million sq ft, followed by Mumbai with 17 million sq ft and Delhi NCR with 16 million sq ft. Hyderabad, Pune, and Chennai also experienced strong leasing activity throughout the year.
Global Capability Centres (GCCs) played a significant role in this growth, achieving a new leasing record of 29.3 million sq ft, which constitutes 33% of gross leasing, thereby reinforcing India’s status as a key global office market.
Diverse Sector Demand
The IT-BPM sector emerged as the largest occupier, representing 31% of total leasing and achieving its highest annual take-up to date. Flexible workspace operators were the second largest segment, with a 15.3% share and a 9% year-on-year growth. The BFSI and engineering & manufacturing sectors also contributed significantly, with shares of 15.1% and 14.3%, respectively, demonstrating a broadening demand base.
Supply, Vacancy, and Rentals
Office supply additions reached a record high of 53 million sq ft in 2025, a 17% increase from the previous year, with Bengaluru and Pune responsible for almost 49% of the total completions. This marked the first time that annual completions surpassed the 50 million sq ft threshold, alleviating supply constraints in various markets.
Despite this record supply, the strong demand led to a significant decrease in vacancy rates, with overall vacancies dropping by 210 basis points year-on-year—representing the steepest annual decline ever recorded. Vacancy rates fell in all major cities except Pune and Ahmedabad, while pre-commitments gained traction as occupiers sought to secure future supply in competitive markets.
Office rentals increased across all eight major cities, particularly in Hyderabad and Mumbai, where year-on-year growth ranged from 12% to 14%. Ahmedabad, Delhi NCR, and Chennai experienced rental hikes in the 6% to 9% range, fueled by tightening vacancies and ongoing leasing activity.
Cushman & Wakefield forecasts that the strong demand-supply dynamics, expanding GCC presence, and diversified occupier base will maintain India’s office market resilience and growth potential through 2026 and beyond.
