Hyderabad office space leasing skyrockets by 270%; Bengaluru slows down
According to the latest report by Vestian, one of India's leading real estate consultants, Hyderabad saw a remarkable 270 per cent increase in the absorption of office space, reaching 3.7 million square feet.
Hyderabad: During the July-September quarter, Hyderabad has emerged as the frontrunner in India’s office space market, marking a significant surge in leasing and new supply.
According to the latest report by Vestian, one of India’s leading real estate consultants, Hyderabad saw a remarkable 270 per cent increase in the absorption of office space, reaching 3.7 million square feet. Concurrently, the new office space supply soared by 175 per cent, amounting to 5.5 million square feet during the same period.
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In contrast, Bengaluru, witnessed a downturn with a 28 per cent decline in the absorption of office space, totaling 3.6 million square feet. Additionally, new supply in Bengaluru dropped by 25 per cent, amounting to 2.7 million square feet, during the July-September period, reported Vestian.
The report covering the top seven cities in India revealed a 21 per cent growth in office leasing and a 26 per cent increase in new supply during the third quarter of the calendar year.
Shrinivas Rao, CEO of Vestian, noted that the Indian office sector experienced heightened activities during Q3 2023, witnessing the highest absorption levels since the pandemic, coupled with a surge in new completions. On the demand-supply trend, he said, “The key office markets in Southern cities evolved and commanded the highest share of the pan-India absorption and new completions.”
Rao predicted a potential rise in rentals in Southern cities, including Hyderabad, as several large corporations are encouraging their employees to return to office spaces, signifying a resurgence in demand.
Office Market:
Demand-Supply Dynamics (Gross Leasing):
Absorption (in million sft):
City Q3 2023 Q3 2022 Y-o-Y Change (%)
Hyderabad 3.7 1 270
Bengaluru 3.6 5 -28
NCR 3 3.50 -14
Mumbai 2.3 1.90 21
Chennai 2 1.10 82
