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Bengaluru Office Market Sees Significant Leasing Decline
12 Oct
Summary
- Bengaluru's office space leasing fell 26% year-on-year to 16.7 million sq ft.
- Overall Indian office leasing remained flat, driven by GCCs and flex operators.
- Mumbai, Pune, and Hyderabad recorded growth in office space leasing.
India's office market activity remained stable between January and September, with total leasing across eight major cities holding steady at 66.7 million sq ft. However, Bengaluru, the nation's largest office market, witnessed a significant 26% year-on-year decline in workspace leasing, reaching 16.7 million sq ft. This decrease is attributed to a high base effect from the previous year.
Despite a challenging global geopolitical landscape, the Indian office sector's fundamentals remain robust. Demand is increasingly being shaped by expanding Global Capability Centres and a surge in activity from flex operators and domestic businesses. This reflects India's growing importance in global capability building and its expanding domestic economy.
In contrast to Bengaluru's decline, several cities reported positive leasing trends. Mumbai saw its gross leasing rise to 9.9 million sq ft, while Pune's leasing increased to 8.8 million sq ft. Hyderabad experienced a substantial 50% growth, with leasing hitting 13.1 million sq ft. Ahmedabad also noted a marginal increase.
Conversely, Delhi-NCR experienced a slight dip, with leasing falling to 9.6 million sq ft. Chennai recorded a 26% decrease to 5.9 million sq ft, and Kolkata saw a marginal decline to 1.5 million sq ft. Rents are reportedly rising across all markets as the year concludes.
