NEW DELHI, Jan 3: India’s office market saw significant activity in 2024, with gross workspace leasing rising by 19 percent, reaching an unprecedented 885.2 lakh square feet across eight major cities, as reported by Cushman & Wakefield.
The gross leasing or absorption of office space in the previous year was recorded at 745.6 lakh square feet, according to data provided by real estate consultancy Cushman & Wakefield (C&W).
“The year 2024 has marked a pivotal moment for India’s office sector, achieving record leasing volumes and reinforcing the nation’s stature as the leading growth market worldwide for office space demand,” stated Anshul Jain, Chief Executive, India, Southeast Asia and APAC Tenant Representation at Cushman & Wakefield.
The rising presence of Global Capability Centers (GCCs), accounting for nearly 30 percent of total demand, highlights India’s vital role for global multinationals, Jain emphasized.
“As we advance into 2025, the demand for Grade-A spaces is expected to remain strong, further solidifying India’s supremacy in the global office market,” Jain forecasted.
Gross leasing volume encompasses all leasing activities within the market, including new take-ups, open market renewals by corporations, and pre-leases, acting as a measure of overall market dynamics, as explained by the consultancy.
Among the eight leading cities, Bengaluru experienced a 64 percent surge in gross leasing, climbing to 259.3 lakh square feet in 2024, up from 158.3 lakh square feet in the prior year.
Mumbai also saw a 27 percent increase in gross leasing, reaching 178.4 lakh square feet compared to 140.8 lakh square feet.
Hyderabad reported a 37 percent rise in gross leasing, totaling 123.1 lakh square feet in 2024, up from 90.1 lakh square feet in 2023, while Ahmedabad noted an 11 percent growth to 18.1 lakh square feet from 16.3 lakh square feet.
Delhi-NCR, Chennai, and Pune recorded a decline in office demand, whereas the Kolkata market remained steady.
In Delhi-NCR, gross office leasing fell by 3 percent to 131.4 lakh square feet, down from 135.7 lakh square feet.
Pune’s gross leasing stood at 84.7 lakh square feet in 2024, showing a 13 percent drop from 97.4 lakh square feet in 2023.
Kolkata maintained a stable office space absorption with 17 lakh square feet in both 2024 and the previous year.
The Information Technology and Business Process Management (IT-BPM), engineering & manufacturing, and Banking, Financial Services, and Insurance (BFSI) sectors were the key drivers of office demand.
From the total gross leasing, coworking operators accounted for approximately 14 percent of workspaces rented from property owners, which they then sub-let to corporates in various sectors.
Commenting on the findings, Vinod Rohira, MD and CEO of Mumbai-based K Raheja Corp, noted that the commercial real estate sector in 2024 experienced record leasing volumes along with a notable decrease in vacancy rates.
“All major cities with an infrastructure focus have seen growth. Notably, large domestic companies are now also significant contributors to demand in these markets,” he remarked.
Looking ahead, Rohira anticipates sustained strong demand for Grade A plus office spaces.
Peush Jain, MD-Commercial Leasing and Advisory at Anarock Group, highlighted that “India’s increasing economic influence has not only drawn global corporations but also motivated domestic firms to pursue aggressive expansion. A notable trend is the ‘flight to quality’,” he stated.
Businesses and tenants are now seeking Grade-A office spaces that provide modern amenities, wellness features, and comply with ESG standards, Jain observed.
“In response, landlords are raising standards by renovating older properties and launching new projects tailored to meet the evolving needs of occupiers,” Jain added. (PTI)
