Office Leasing Soars 40% in H1 2025, Driven by Tech, GCC Expansion

Mumbai, August 23, 2025: The commercial office real estate sector achieved exceptional growth in the first half of 2025 with net office leasing surging 40 per cent YoY to 26.8 mn square feet (MSF) across the top seven cities. 

Bengaluru maintained market leadership with 6.55 MSF of absorption while Pune emerged as the fastest-growing market with 188 per cent growth.

Peush Jain, MD, Commercial Leasing and Advisory, ANAROCK Group, said, “New office supply increased 25 per cent to 24.51 million square feet, creating balanced market dynamics. Vacancy rates improved marginally to 16.3 per cent and average rentals grew 4 per cent to INR 88 per square foot per month. The IT-ITES sector dominated with 29 per cent market share, followed by co-working spaces at 22 per cent.”

Market fundamentals remain healthy, supported by Global Capability Centre (GCC) expansion and sustained corporate confidence, positioning the sector for continued growth through 2025.

Key Data

• Net Office Absorption: 26.8 MSF in H1 2025, representing a robust 40 per cent YoY increase from 19.08 MSF in H1 2024

• Top Markets: Bengaluru leads with 64 per cent growth, Pune rockets 188 per cent in office absorption and 533 per cent in new supply

• New Office Supply: 24.51 MSF delivered in H1 2025, marking a 25 per cent growth compared to 19.65 MSF in the previous year

• Average Office Rentals: INR 88/sq ft per month in H1 2025, reflecting a steady four per cent increase and demonstrating stable pricing dynamics despite strong demand

• Office Vacancy: Dips to 16.3 per cent but rentals rise 4 per cent amid strong demand in top cities

• Tech Sector: Drives 29 per cent of leasing share. Co-working and BFSI also strong performers

• Market Vacancy Rate: 16.3 per cent in H1 2025, showing marginal improvement from 16.7 per cent in H1 2024, indicating a healthy market equilibrium

• Large Transaction Dominance: 57 per cent of all office deals exceeded 0.1 MSF, up from 52 per centin H1 2024, reflecting corporate preference for larger consolidated spaces

• Global Capability Centres: GCCs drove office demand in H1 2025, leasing 5.45 MSF in Bengaluru, 2.81 MSF in NCR, 2.77 MSF in Pune, 0.95 MSF in Chennai and 1.93 MSF in Hyderabad