India’s office leasing soars 20% in 2025, residential sales remain steady

India’s office leasing surged 20% in 2025, reaching 86.4 million sq ft, driven by strong demand and flexible workspaces. Residential sales steadied, with Mumbai leading, as market normalizes post-pandemic

New Delhi: India’s office market touched record high in 2025, with annual gross leasing surging to 86.4 million sq ft, up 20 per cent (year-on-year) and 43 per cent above the pre‑pandemic 2019 peak, a report said on Friday.

Real estate services firm Knight Frank India said that on the residential front, sales across eight major cities held broadly steady at 3,48,204 units in 2025, easing 1 per cent YoY.

---

In the same period, new launches were recorded at 362,184 units across the top markets easing 3 per cent YoY. Mumbai accounted for 29 per cent of sales with 97,188 units.

On the office market front, the scale of activity reflected sustained occupier demand and positions India as a global leader among commercial real estate markets, the report said.

Strong performance across regions reflected the maturity of India’s office ecosystem, supported by robust talent pools, resilient demand drivers and disciplined supply.

“With annual leasing volumes rising over 20 per cent YoY, the current cycle marks not just a numerical high but a structural shift in how global and domestic enterprises view India as a long-term business destination,” said Shishir Baijal, International Partner, Chairman and Managing Director, Knight Frank India.

Bengaluru led the office market with a historic 28.7 million sq ft of leasing. Delhi-NCR retained its position as India’s second-largest office market in terms of total stock. The residential sector, meanwhile, entered a phase of measured normalisation after three consecutive years of elevated activity, supported by end-user activity and sustained by premiumisation and firm price growth, the report noted.

Global Capability Centres (GCCs) accounted for 38 per cent of total absorption, while third‑party IT services rebounded strongly, taking 15.3 million sq ft (20 per cent of transacted area), up 94 per cent YoY.

Flexible workspace operators leased a record 18.6 million sq ft, marking 19 per cent surge YoY. Rents grew between 1 per cent and 16 per cent YoY across all markets in H2 2025, led by Kolkata (16 per cent), with NCR and Hyderabad surging 10 per cent each.