Hyderabad Office Market Hits Historic High With Record 3.15 MSF Leased in Q1 2026
Hyderabad, May 19, 2026: Hyderabad’s office market achieved a historic milestone in Q1 2026, recording its highest-ever first-quarter gross leasing volume (GLV) at 3.15 million square feet (MSF). According to Cushman & Wakefield’s latest Office MarketBeat report, this represents a 21.6% year-on-year (YoY) increase, capturing 14% of India’s total 22 MSF office leasing for the quarter. Transactions were heavily dominated by large-sized deals ($\ge$ 100,000 sq ft) at 81% of total GLV, with the Madhapur micro-market capturing 91% of all city leasing.
Despite zero new supply completions during the quarter, net absorption remained robust at 2.21 MSF. This high demand compressed citywide vacancy by 260 basis points YoY to 20.22%, while Madhapur’s vacancy dropped to 7.5%, and just 4.8% for premium Grade A+ assets. Consequently, Hyderabad’s average stock-weighted rent rose 11.6% YoY to a record INR 92.2, led by Madhapur at Rs 105.5, while Gachibowli offered a cost advantage at Rs 72.3. Sectorally, IT-BPM led leasing at 36%, followed by flexible workspaces at 30%, and BFSI at 23%. Global Capability Centres (GCCs) secured 0.83 MSF, accounting for 26% of the GLV.
The city’s supply pipeline remains strong, with 11 MSF of new space expected through the rest of 2026, mostly in Gachibowli and Madhapur, and another 20 MSF projected for 2027–2028.
Veera Babu, Executive Managing Director, Tenant Representation – India, Cushman & Wakefield, said, “Hyderabad has seen a strong start to 2026, with gross leasing volumes reaching a new high for the first quarter. The city continues to hold a strong position within India’s office market and stands out for its ability to accommodate large occupier requirements, even as availability tightens across several key markets. Sustained absorption has contributed to a steady decline in vacancy levels, with the current quarter marking the lowest level recorded over the past 15 quarters, reflecting continued strength in underlying occupier demand. Looking ahead, the market remains well positioned to sustain leasing momentum, supported by an active demand pipeline of nearly 12–15 million square feet currently under discussion. Incremental supply expected over the coming quarters, along with Hyderabad’s strong talent base and growing GCC presence, should continue to support demand across the market.”
