India’s office market is gearing up for robust growth, with 85% of domestic firms planning to expand their workspace portfolios over the next two years, according to CBRE’s 2025 India Office Occupier Survey. This was 73% in 2024.

The report highlights a strong rebound in office leasing, rising preference for flexible workspaces, and sustained demand from global capability centres (GCCs), underscoring India Inc.’s pivotal role in shaping the next phase of the country’s workplace ecosystem.

As compared to the pre-COVID-19 period of 2018-19, domestic firms recorded a remarkable resurgence in office leasing during 2023–2024, registering an increase of ~86%.

Over the next two years, the demand for workspaces is also expected to be supported by an office-first policy and tighter hybrid arrangements. The survey revealed that around 94% of the companies prefer their employees working from office at least three days a week. Furthermore, about 52% of the surveyed firms have a policy of working fully from the office, compared to 36% in 2024.

More companies want flex spaces

Flexible workspace operators have firmly established themselves in India’s office leasing landscape, consistently capturing a more than 15% share in overall yearly absorption trends. The survey indicated this momentum is expected to continue, with the number of companies allocating 26–50% of their portfolio to flexible spaces set to rise by more than two-fold over the next two years. Notably, 58% of the surveyed small occupiers plan to place over 10% of their office portfolio in flexible workspaces within the next two years, while the share of large occupiers doing so is projected to rise to 52% by 2027, up from 33% today.

GCCs continue to drive demand

Apart from flexible spaces, global capability centres (GCCs) continue to drive strong office space demand in India, accounting for a ~35-40% share in total annual absorption in recent years. This momentum is underpinned by a strategic shift as GCCs transform from cost-efficient back-office units into high-value innovation hubs focused on R&D, AI, and core engineering. Around 65% of the surveyed GCCs are expected to expand their portfolios over the next two years, with BFSI, life sciences, and engineering & manufacturing emerging as the leading sectors. Leasing activity has reflected this growth trajectory, with the average GCC deal sizes also increasing to ~108,000 sq. ft. in H1 2025 from ~91,000 sq. ft. in 2024.

The report further highlighted that nearly 75% of the surveyed GCCs have already defined ESG goals for their real estate portfolios, reflecting the growing prominence of sustainability in occupier strategies. This momentum is set to strengthen further as the government’s Business Responsibility and Sustainability Reporting (BRSR) framework encourages companies to formalise standards and allocate dedicated budgets for sustainability initiatives.

Moreover, there is a growing preference amongst occupiers to expand in smaller cities over the next few years. Companies are increasingly exploring tier-II / III cities as the next growth opportunity, aided by the presence of a skilled talent pool, competitive costs, and developing infrastructure and connectivity.