Bengaluru has firmly established itself as the leading hub for office space leasing in India, continuing its dominance in the commercial real estate market. Amidst global uncertainties, India’s office leasing market remains resilient, with Bengaluru emerging as the clear frontrunner. According to recent research from ANAROCK, office space leasing across India’s top cities surged by 40% in the first half of 2025. This growth signals the continued attractiveness of India’s real estate sector, with Bengaluru’s office market leading the way with impressive year-on-year gains.
Bengaluru’s Exceptional Growth in Office Leasing
Bengaluru has reported the highest net office leasing in H1 2025, with an impressive 6.55 million sq. ft. leased. This represents a remarkable 64% increase compared to 4 million sq. ft. leased in the same period last year. The city’s office leasing market has seen substantial growth despite challenges in other parts of the world, highlighting Bengaluru’s strength as a commercial real estate hotspot.
- Yearly Increase in Net Leasing: 64% (6.55 million sq. ft. in H1 2025 compared to 4 million sq. ft. in H1 2024)
- New Office Supply: Bengaluru also saw the highest new office space supply, with approximately 6.91 million sq. ft. added in H1 2025, a 26% increase from last year’s 5.5 million sq. ft.
National Trends in Office Space Leasing
The office leasing market across the top 7 cities in India recorded a significant 40% year-on-year increase in net absorption. From around 19.08 million sq. ft. in H1 2024, net office leasing surged to 26.8 million sq. ft. in H1 2025.
- Top Cities Net Absorption in H1 2025: Approx. 26.8 million sq. ft.
- Top 7 Cities’ Yearly Office Leasing Growth: 40%
However, while Bengaluru continues to lead, other cities also displayed growth. Pune, for example, recorded the highest percentage increase in net absorption, with a remarkable 188% rise, from 1.32 million sq. ft. in H1 2024 to 3.8 million sq. ft. in H1 2025.
- Pune’s Annual Absorption Growth: 188%
- Kolkata’s Decline: The only city to see a decline in leasing (51% drop from 0.93 million sq. ft. in H1 2024 to 0.45 million sq. ft. in H1 2025)
New Office Completions in India
The top 7 cities collectively saw a 25% increase in new office completions in H1 2025, reaching 24.51 million sq. ft., compared to 19.65 million sq. ft. in H1 2024. Again, Bengaluru led the charge, with a total new office supply of 6.91 million sq. ft. in the first half of 2025.
- Increase in New Office Supply (Top 7 Cities): 25%
- Bengaluru’s New Office Supply (H1 2025): 6.91 million sq. ft.
Office Vacancy Rates and Rental Trends
The vacancy rate across the top 7 cities showed marginal improvement, dropping slightly to 16.3% in H1 2025 from 16.7% in H1 2024. Despite this overall reduction, cities like Mumbai Metropolitan Region (MMR) and Hyderabad saw increases in vacancy rates due to limited new office supply.
- Vacancy Rate (Top 7 Cities): 16.30% in H1 2025
- Vacancy Rate (MMR): 15.10% (up from 13% in H1 2024)
- Vacancy Rate (Hyderabad): 26.60% (up from 25.50% in H1 2024)
Meanwhile, office rental prices have seen a marginal increase, with average monthly office rents rising by 5%. Bengaluru and NCR both recorded a 5% increase, while Chennai saw the highest rise of 6%.
- Average Monthly Office Rent Growth (H1 2025): 5% increase
- Highest Rent Increase: Chennai (6% rise from INR 72/sq. ft. in H1 2024 to INR 76/sq. ft. in H1 2025)
Summary Table: Quick Facts
| Metric | H1 2025 | H1 2024 | Year-on-Year Change |
|---|---|---|---|
| Bengaluru Net Leasing | 6.55 million sq. ft. | 4 million sq. ft. | +64% |
| New Office Supply (Bengaluru) | 6.91 million sq. ft. | 5.5 million sq. ft. | +26% |
| Top 7 Cities Net Absorption | 26.8 million sq. ft. | 19.08 million sq. ft. | +40% |
| Pune Net Absorption Growth | 188% | – | +188% |
| Vacancy Rate (Top 7 Cities) | 16.3% | 16.7% | -0.4% |
| Average Rent Growth | 5% increase | – | +5% |
Relevant Quotes:
- “Bengaluru continues to demonstrate its resilience and dominance in the office leasing market, with a remarkable 64% increase in leasing activity in H1 2025,” said the spokesperson from ANAROCK Research.
- “Despite challenges in other regions, India remains a safe haven for long-term investments in commercial real estate, with Bengaluru leading the charge,” commented a senior real estate analyst.
FAQ Section
1. What is the primary reason for Bengaluru’s office leasing growth in 2025?
Bengaluru’s strong performance can be attributed to its thriving IT sector, high demand from tech companies, and its status as a global business hub.
2. Which city saw the highest percentage growth in office space absorption?
Pune recorded the highest growth, with a 188% increase in office space absorption.
3. What is the current vacancy rate in Bengaluru?
Bengaluru’s vacancy rate is 16.3%, which is slightly improved from the previous year.
4. How much new office space was supplied in Bengaluru in H1 2025?
Bengaluru saw the highest new office supply with 6.91 million sq. ft. added in the first half of 2025.
5. What is the rental growth trend for office spaces in India?
Average office rents across India increased by 5% in H1 2025, with Chennai recording the highest increase at 6%.