New Delhi, Jan 5 (NationPress) India’s office real estate market concluded CY25 with its most impressive performance ever, recording a net absorption of 61.4 million square feet (MSF) across the top eight cities, reflecting a substantial 25 percent year-on-year (YoY) increase, according to a report released on Monday.

The analysis from Cushman & Wakefield, a firm specializing in commercial real estate services, attributed this remarkable growth to heightened occupier confidence and the market's adaptability to changing business requirements.

Bengaluru topped the list with 14.4 million square feet (MSF) of absorption, followed by Delhi NCR with 10.9 MSF, and Mumbai at 9.6 MSF. Other cities included Hyderabad (9.1 MSF), Pune (8.2 MSF), Chennai (7.0 MSF), Kolkata (1.4 MSF), and Ahmedabad (0.8 MSF).

Chennai and Delhi NCR experienced the highest YoY growth rates at 187 percent and 82 percent respectively, highlighting the strengthening of market fundamentals and an enhanced capacity to cater to the growing office demand.

The gross leasing volume (GLV) approached a record of approximately 89 MSF, with new leases comprising nearly 80 percent of the total activity. Global Capability Centres achieved a new peak of 29.3 MSF, which represents 33 percent of GLV, according to the report.

“With GCC expansion making up nearly one-third of total leasing, coupled with the increase in technology adoption, a varied occupier base, and a rich talent pool, India is strategically positioned to uphold its dominance in the global office market through 2026 and beyond,” stated Anshul Jain, Chief Executive – India, SEA, MEA & APAC Office and Retail, Cushman & Wakefield.

The IT-BPM sector claimed the largest share at 31 percent of leasing, achieving its highest annual leasing volume to date. Flexible workspace providers accounted for 15.3 percent of the market share, showcasing a 9 percent YoY growth. The BFSI and Engineering & Manufacturing sectors also remained significant contributors, holding 15.1 percent and 14.3 percent shares respectively.

Despite record supply levels, robust demand resulted in a noteworthy decline in vacancy rates, with an overall reduction of 210 basis points (bps) YoY, marking the steepest annual decrease on record. All major cities reported lower vacancy levels, with the exception of Pune and Ahmedabad.

Pre-commitments gained momentum, particularly in prime markets with tightening vacancies, as occupiers sought to secure quality spaces ahead of project completions.

Rental prices increased across all top eight cities, led by Hyderabad and Mumbai with 12–14 percent YoY growth. Ahmedabad, Delhi NCR, and Chennai experienced rental growth in the 6–9 percent range, the report indicated.