India set to become world's 4th largest office mkt, nearing 1 billion sq ft

India's commercial real estate sector races toward a historic landmark, with Bengaluru, NCR, and Mumbai driving nearly 60% of growth. Office market now valued at ₹16 trillion.

India is just weeks away from achieving a historic feat in the global commercial real estate landscape. According to Knight Frank’s latest report “A Billion sq ft and Counting – India Office Supply Growth Story,” the country is set to cross 1 billion square feet of office stock by the third quarter of 2025, making it the fourth largest office market in the world.

 

This milestone represents a monumental leap from just 192 million sq ft in 2005, growing at a compound annual growth rate (CAGR) of 8.6% over the last 20 years. With 993 million sq ft of office stock recorded as of June 2025, India now stands on the brink of global real estate recognition, trailing only China (6.26 bn sq ft), the US (10.2 bn sq ft), and Japan (1.77 bn sq ft).

 

City Leaders: Bengaluru, NCR, and MMR Dominate

Among the top contributors, Bengaluru leads with 229 mn sq ft (23%), followed by NCR at 199 mn sq ft (20%), and Mumbai Metropolitan Region (MMR) with 169 mn sq ft (17%). These three cities together account for 60% of India’s total office stock, driven by strong demand from global capability centres (GCCs), IT/ITeS, and multinational occupiers.

 

Other significant contributors include:

 

Hyderabad – 123 mn sq ft (12%)

 

Pune – 106 mn sq ft (11%)

 

Chennai – 92 mn sq ft (10%)

 

Ahmedabad – 41 mn sq ft (4%)

 

Kolkata – 34 mn sq ft (3%) 

# CAGR for Bengaluru, NCR, MMR, Hyderabad, Chennai and Pune is over for a 20-year time frame whereas for Kolkata and Ahmedabad is it over a 11 year and 9-year timeframe

 

India’s Cost Advantage: Global-Quality Spaces Under $1/sq ft

 As of 2025, average office rents have dipped below $1/sq ft/month, standing at $0.96, giving India a distinct “sub-dollar advantage” in the global office landscape. 

A defining competitive edge of India’s office market lies in its remarkable cost efficiency, especially when benchmarked in dollar terms.

 

This price-performance combination has led to the rapid expansion of Grade A workspaces, now making up 53% of India’s office stock, attracting increased attention from institutional investors and multinational tenants alike.

 

“India’s sub-dollar rental positioning is a powerful differentiator. Occupiers are now focused on quality, ESG compliance, and flexibility — areas where India is increasingly excelling,” said Viral Desai, Senior Executive Director, Knight Frank India. 

Market India’s office demand has transformed dramatically from 1990 to 2025, evolving from a tech- industry support base into a global hub for capability centres, rising in the value chain.

 

Grade-Wise Composition Shows Maturity

The report reveals that Grade A buildings account for 53%, followed by Grade B at 43%, and Grade C at 4% of total supply. Cities like Bengaluru (70%), Hyderabad (68%), and Chennai (64%) lead in Grade A development, while older markets like Mumbai and NCR have a more balanced mix.

 

India’s Office Market: From Volume to Value

India’s journey to 1 billion sq ft has passed through seven phases of transformation, from supporting tech firms in the 1990s to becoming a global hub for GCCs and financial services. The implementation of SEZ policies, infrastructure investments, and regulatory reforms have further accelerated this growth.

 

“Crossing the 1 bn sq ft mark is more than symbolic — it showcases the resilience and institutional depth of India’s office market,” said Shishir Baijal, CMD, Knight Frank India. “India now offers a compelling value proposition for global capital and corporate occupiers alike.”

 

Global Ranking and Future Outlook

Once India crosses 1 billion sq ft in Q3 2025, it will officially become the fourth-largest office market in the world, surpassing key global peers: 

Source: Knight Frank LLP

 

Looking ahead, India could double its office stock to 2 billion sq ft between 2036–2041, depending on economic and policy momentum. Based on GDP growth forecasts and institutional absorption trends, the report estimates:

 

At a CAGR of 12.7%, India reaches 2 bn sq ft by 2036

 

At a CAGR of 10.9%, the mark is achieved by 2041