Office Space Supply Hits Record High in India's Top Cities

New Delhi, Feb 27 (PTI) New supply of office space hit an all-time high in the last calendar year to 515 lakh square feet across seven major cities amid strong demand for premium workspace, according to Vestian.

Real estate consultant Vestian on Thursday released its report on Indian office market which showed that office rent increased by 4 per cent to 8 per cent across the top seven cities last year.

In 2024, the office space leasing or absorption reached an all-time high of 707 lakh square feet, reflecting a 16 per cent annual increase.

Shrinivas Rao, CEO of Vestian, said, "IT-ITeS sector continued to dominate leasing activities during 2024. While IT industry is expected to lead in 2025 on the back of strong demand from GCCs (global capability centres), other segments such as BFSI and flexible workspaces providers are also anticipated to garner traction."

Among cities, Hyderabad witnessed a 7 per cent growth in new supply of offices at
145 lakh sq ft, followed by Bengaluru that saw 4 per cent growth to 140 lakh sq ft.

The new supply of office space rose in Mumbai 170 per cent to 73 lakh sq ft while the fresh supply grew 30 per cent in Delhi-NCR to 69 lakh square feet.

Pune saw a 11 per cent increase in fresh office supply to 59 lakh square feet.

However, Kolkata witnessed no new completions during 2024 as compared to over 10 lakh sq ft of supply in the previous year.

The new supply of office space declined 57 per cent annually in Chennai to 29 lakh square feet during 2024 calendar year.

Commenting on new supply, Darshan Govindaraju, Director of Vaishnavi Group, said the record supply of office spaces in Bengaluru underscores the city's position as India's top market for commercial real estate absorption.

"The revival in demand, led by MNCs expanding their Global Capability Centres (GCCs) and a surge in startup activity, is driving unprecedented growth in the sector," he added.

Ashish Sharma, AVP-Operations of Gurugram-based Brahma Group, said the higher supply of office space in Delhi-NCR will help attract global corporations and technology giants.

Shesh Rao Paplikar, CEO & Founder of BHIVE Workspaces, noted that Bengaluru's office market continues to thrive, driven by its strong position as India's leading tech hub and the growing presence of Global Capability Centers (GCCs), BFSI firms, and a dynamic startup ecosystem.

"Companies are expanding aggressively, fuelling the need for premium office spaces, while the rise of startups has propelled demand for flexible workspaces," he added.