Leasing for Grade A offices increased by 11% in the second quarter of calendar year 2025, driven by demand for flexible workspace.

According to real estate consultancy Colliers, gross leasing of Grade A office space in India's top seven cities surged by 11% year-on-year to reach 17.8 million square feet (msf) in Q2 CY25. This growth was fueled by strong demand from flexible workspace providers and companies in the technology, Banking, Financial Services, and Insurance (BFSI), engineering, and manufacturing sectors. Bengaluru led the way with 4.8 msf of leasing activity, while Hyderabad, Mumbai, and Chennai each exceeded 2.5 msf during the quarter. Overall demand in the first half of CY25 totaled 33.7 msf, reflecting a 13% increase compared to the previous year, indicating that occupier confidence remains strong despite global challenges. Flexible workspaces represented 4.3 msf, whereas conventional leasing accounted for 13.5 msf, primarily driven by technology companies, which alone secured 6.4 msf of space—a significant 42% increase resulting from the expansion of Global Capability Centres (GCC). Total office supply increased by 11% year-on-year to reach 14.9 msf, although cities like Delhi National Capital Region (NCR), Mumbai, Kolkata, and Hyderabad experienced declines in supply. The nationwide office vacancy rate remained unchanged at 16.2%, with elevated levels in Pune and Hyderabad attributed to substantial completions.