New Delhi, July 7 (IANS) India’s office real estate market continues to demonstrate robust growth with gross leasing volume in the top eight cities, reaching 21.4 million square feet (MSF) in the April-June quarter (Q2), reflecting a 5 per cent quarter-on-quarter growth, according to a report released on Monday.

With H1 2025 gross leasing now at around 42 msf, the sector is firmly on track to surpass 90 million square feet of annual leasing activity – a new benchmark and a reaffirmation of sustained occupier confidence, the report by Cushman & Wakefield stated.

This momentum follows 2024’s historic performance of about 89 million square feet, with H1 2024 figures comparable to this year’s. If trends hold, 2025 will mark the second consecutive year of 85+ million square feet of gross leasing, reinforcing a new baseline of market performance, the report added.

The strong leasing numbers reflect the depth of demand from global and domestic occupiers, with Global Capability Centres (GCCs), IT-BPM firms, flex operators, BFSI, and engineering and manufacturing companies driving growth.

Gross leasing volume, which factors in all leasing activity in the market, including fresh take-up, open market renewals by corporates as well as pre-leasing, is an indication of overall market activity.

In terms of cities, Bengaluru (5.0 MSF), Delhi NCR (4.6 msf) and Mumbai (3.9 msf) collectively contributed around 63 per cent of the quarterly leasing volume. The other cities followed with Pune (3.3 msf), Chennai (2.2 msf), Hyderabad (1.7 msf), Kolkata (0.5 msf) and Ahmedabad (0.2 msf).

Net absorption, a key indicator of real estate demand in terms of expansion of occupied space in the market, stood at 13.5 MSF in Q2, marking a 19 per cent year-on-year growth, and totalled 27.8 msf for H1 2025. Delhi-NCR (5.2 MSF), Pune (4.3 MSF), and Chennai (3.1 MSF) posted their highest ever half yearly net absorption, reflecting long-term occupier confidence in the Indian office market, according to the report.

Fresh leases accounted for 77 per cent of total leasing activity in H1 2025, a trend that has consistently remained above the 70 per cent mark since late 2022. Notably, pre-commitments rose to 10 per cent, suggesting a supply crunch in core markets and heightened occupier urgency.

Global Capability Centres continued to be a major demand driver, contributing 24 per cent of the overall leasing activity in the quarter at 5.1 MSF. Bengaluru (1.6 MSF) and Pune (1.6 MSF) accounted for 63 per cent of this leasing.

H1 2025 marked a historic high for GCC leasing in the first half of any year, with 11.4 msf transacted, up 3 per cent year-on-year. IT-BPM held the largest share at 40 per cent, followed by E&M GCCs with a share of 36 per cent, the report added.

–IANS

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