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India Office Leasing Hits Record High Amid Global Flux
7 Apr
Summary
- Office leasing reached a record 29.9 million sq ft in Q1 2026.
- Global Capability Centres drove 48% of total leasing.
- Office rents rose 2-15% year-on-year across major cities.
India's office property market has established a new benchmark, recording its strongest quarterly performance to date in Q1 2026. Leasing activity surged to an unprecedented 29.9 million sq ft across the top eight cities, surpassing previous records. This significant growth highlights India's increasing strategic importance on the global business stage.
Global Capability Centres (GCCs) emerged as the dominant force, leasing a record 48% of the total space. Bengaluru continued to lead office absorption with 9.2 million sq ft, followed by Hyderabad and Mumbai, both achieving their highest-ever quarterly absorption figures.
Despite global economic headwinds, the demand for quality office spaces remained robust, particularly for Grade A assets which constituted 93% of transactions. This sustained demand, coupled with a significant 154% year-on-year increase in supply delivery, has tightened vacancy levels to 13.9% and fueled a rental upcycle.
Office rents experienced a year-on-year increase ranging from 2% to 15% across key markets. Experts anticipate that India's structural economic strengths and its evolving role in global corporate strategies will sustain this positive leasing momentum in the medium term, even amidst near-term global uncertainties.
