NEW DELHI: Colliers India aims to achieve an order book of ₹1,100 crore by 2025, a significant increase from its revenue of around ₹700 crore last year. The company has reported a strong start to the year, with its leasing division experiencing a growth of 20–25% over 2024.
Sankey Prasad, chairman and managing director, expressed in an exclusive interview with ETRealty that the firm is optimistic about India’s commercial real estate sector, noting strong fundamentals and persistent demand amidst global challenges.
As part of its global integration strategy, Colliers is setting up a new Global Capability Centre (GCC) in Bengaluru. Currently operating from a smaller facility, it will soon transition to a larger, consolidated space. This centre will cater to Colliers’ international operations, and all positions will be filled with new hires rather than internal transfers. “This centre is designed solely for Colliers’ global needs, focused on cost optimization and centralized support,” Prasad stated.
Despite economic uncertainties and layoffs in key Western markets, India’s office market is expected to remain robust in 2025. “We forecast gross office leasing this year to be between 65–70 million square feet, nearly matching last year’s 66.5 million,” Prasad noted, highlighting a strong momentum with Q1 2025 recording 15.9 million sq ft of leasing.
Prasad attributes the ongoing demand to major sectors such as engineering, manufacturing, and BFSI, which are projected to make up 35–40% of office leasing. Although technology companies are adjusting to hybrid work models, they are anticipated to contribute an additional 25–30%, while flexible space operators will maintain a 20% share. Additionally, select tier-2 and tier-3 cities may attract leasing activity due to cost benefits and improved infrastructure.
While layoffs in the US and Europe have raised concerns about reduced expansion plans, Prasad emphasized that major firms in India have already adopted a cautious approach to real estate expansion since the pandemic. “Most businesses did not scale up their office space in line with headcount growth over the past few years,” he said. “This conservative strategy is now protecting them from excessive exposure as they realign workforce needs.”
He dismissed the idea of a significant leasing slowdown unless a global economic crisis occurs, asserting that “many multinationals are still planning to acquire more space by Q3 or Q4.” He also indicated that Colliers’ leasing pipeline has increased by 20–25% compared to the previous year.
Grade-A supply remains limited as leasing outstrips construction
Developers have been hesitant to launch new commercial supplies post-COVID, leading to a shortage of high-quality, sustainable office spaces. Although some pre-pandemic projects are becoming available, the pace of new additions remains slow.
This imbalance has created opportunities for redeveloping and upgrading older Grade B and C properties. “We are actively advising on several such projects. There is considerable interest in Grade-A spaces, and quality continues to be a key differentiator,” Prasad mentioned.
The Global Capability Centre segment is a major driver of this demand, accounting for 6.5 million sq ft, or 41% of total leasing across major cities in Q1 2025. Colliers forecasts that GCCs will lease 25–30 million sq ft this year, sustaining their share at 40–50% of overall office demand.
Investment flow shows resilience and shifts in strategy
While there has been a temporary decline in FDI due to geopolitical and economic conditions, Prasad noted consistent investor interest. “India attracted $529 million in FDI for construction development in FY25 to date,” he reported. “Family offices are increasingly becoming assertive and flexible investors, often favoring hybrid equity-debt models to optimize returns and manage risk.”
Collaborations between family offices and developers are being developed for long-term value creation. Colliers has observed private funding expanding beyond office real estate into logistics, data centers, and townships, reflecting broader investor confidence.
Branded developers consolidating the residential market
In the residential sector, the trend of consolidation among leading developers is intensifying. Prominent developers dominate new launches and land acquisitions, frequently at premium prices unattainable by smaller or mid-sized builders. “Consumer confidence, financial strength, and execution capabilities give these firms a distinct advantage,” Prasad explained.
This trend, however, is raising land prices and affecting the viability of mid-income and affordable housing. While tier-2 cities may benefit from targeted interventions, the growing affordability gap in tier-1 cities could further strain supply. “There’s a pressing need to rethink development models to address mid-income demand,” he added.
