Office space demand may rise 5% in top 6 cities to 70 mn sq ft: Colliers

Demand for office space in India's top six cities is expected to remain strong this calendar year with gross leasing transactions estimated at 650-700 lakh square feet, according to Colliers India.

The gross leasing of office space stood at record 664 lakh square feet in 2024 calendar year across Delhi-NCR, Mumbai, Bengaluru, Pune, Hyderabad and Chennai.

Real estate consultant Colliers India on Tuesday released its report 'India Office: Setting New Standards for 2025' at the FICCI 18th Real Estate summit here.

India's top six cities have witnessed significant scale-up in office leasing and supply, helping office market set new records in successive years.

"The scale-up, mainly driven by evolving occupier preferences is likely to gain further momentum, with gross leasing across the top six cities projected to reach 65-70 million (650-700 lakh) sq ft in 2025," the consultant said.

The surge in overall leasing volume is likely to be driven by diversification of occupier base, continued expansion of Global Capability Centers (GCCs) and business optimism amid domestic occupiers, it added.

Arpit Mehrotra, Managing Director, Office Services, Colliers India, said Bengaluru would account for an estimated one-third of the overall office space demand in 2025, led by space uptake from GCCs, engineering & manufacturing firms and flex space operators.

Hyderabad and Delhi-NCR are likely to see heightened activity and register 10-15 million (100-150 lakh) square feet of leasing activity each.

Mumbai, Chennai and Pune are likely to witness 5-10 million (50-100 lakh) square feet of Grade A office space demand each in 2025, Mehrotra said.

On the projection, DLF's Vice Chairman and MD (Rental Business) Sriram Khattar said, "the current space take up scenario is quite robust with GCCs, technology companies, BFSI and managed office space operators providing strong impetus."  Khattar said the corporate clients continue to distinguish between Grade A and Grade A plus properties, which meet all safety norms and are sustainable for the overall wellbeing of their employees.

Peush Jain, MD-Commercial Leasing and Advisory, Anarock Group, said GCCs have emerged as the largest office occupiers in top metro cities.

In 2025, GCC and IT/ITeS expansion in Tier-1 and Tier-2 cities will be the key growth driver of office demand, he added.