India's Office Market Soars: Record Leasing in Q1 Driven by GCC Demand, Supply Crunch

• India's office market achieved a record 29.9 million sq ft leasing in Q1 2026, a 6% jump from the previous peak, despite global geopolitical tensions.
• Global Capability Centres (GCCs) drove nearly half of the leasing activity, transacting 14.4 million sq ft, the highest share and volume on record.
• Bengaluru remained the largest leasing hub, while Hyderabad and Mumbai recorded their highest-ever quarterly volumes, with NCR nearly doubling its leasing.
• A supply crunch, with completions at 14.0 million sq ft against 29.9 million sq ft absorbed, has led to declining vacancy rates and rising rents.
• Rental growth ranged from 2% to 15% year-on-year, with NCR and Bengaluru crossing ₹100 per sq ft per month for the first time.

Key Questions Answered

Will office rents continue rising across major Indian cities?

Office rents are expected to continue rising across major Indian cities due to a supply crunch and strong demand. Rental growth in Q1 2026 ranged between 2% and 15% year-on-year.

How will the supply crunch impact future office space availability?

Supply crunches, driven by geopolitical conflicts and equipment shortages, are expected to impact future office space availability by potentially delaying project timelines and increasing construction

What drives the strong demand for office spaces in India?

Strong demand for office spaces in India is driven by expanding Global Capability Centers (GCCs) and the increasing integration of flexible workspaces into corporate strategies.