The demand for Grade A office space in India’s top six cities saw a significant increase of 31% year-on-year in the third quarter of 2024, according to recent research by Colliers. This surge led to a total leasing of 17.3 million square feet, with Bengaluru and Hyderabad leading the way by accounting for over half of the quarterly space uptake.
Key insights from the report include a strong growth in office space absorption across cities like Bengaluru, Chennai, Delhi-NCR, Hyderabad, Mumbai, and Pune. Year-to-date absorption reached 46.7 million square feet, showing a 23% increase compared to the same period in 2023.
Arpit Mehrotra, Managing Director of Office Services for India at Colliers, pointed out trends such as the resilience in demand in cities like Bengaluru, Hyderabad, and Mumbai, which have either met or exceeded demand levels from 2023. Large-sized deals, constituting 65% of total leasing activity in Q3 2024, further highlight occupiers’ confidence in the market.
In terms of sector contributions, the technology sector led the way with 25% of overall office space demand, followed by the BFSI sector and flexible space operators. Bengaluru dominated BFSI leasing with a 39% market share, while Pune surpassed Mumbai with a 25% share.
The report also noted the introduction of 14.4 million square feet of new Grade A office supply in Q3 2024, marking a 33% increase from the previous year.
Overall, this growth in office space absorption reflects a robust recovery in the commercial real estate sector, driven by increased occupier confidence and strategic expansions in key industries across major Indian cities.
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