India’s office market scaled unprecedented heights in 2025, recording its highest-ever annual gross leasing activity of 83.3 million square feet, according to a report by JLL. Sustained demand from global occupiers—who accounted for 58.4% of total leasing volumes—combined with strong expansion by Global Capability Centers (GCCs) and flex workspace operators, underscored India’s growing stature as a strategic global business hub.

With multiple cities logging their best-ever leasing performance and vacancies falling to a five-year low, the market continues to defy global workspace contraction trends and is now firmly positioned to potentially cross the 100 million sq. ft leasing milestone over the next two years.

The cities of Bengaluru, Hyderabad, Pune, and Mumbai recorded their best-ever year in gross leasing terms, showcasing broad-based and secular demand across multiple industry segments. Gross leasing in other cities was also higher year-over-year or at near-similar levels compared to the previous year. This strongly indicates demand dispersion as occupier strategies evolve in a dynamic environment.

India’s unequivocal status as ‘office to the world’ finds support in GCCs increasing their market activity share in 2025

“Global Capability Centers (GCCs) established themselves as the dominant force in India’s office leasing market in 2025, capturing a commanding 37.7% share of gross leasing activity and achieving record-breaking 31 million square feet of space absorption—the highest annual figure ever recorded for this segment. This exceptional performance was complemented by the Flex segment reaching unprecedented heights with a 26.6% share in Q4 2025, marking its highest quarterly contribution to date. Tech maintained its position as the full-year leader with 25.8% of total leasing volumes, while Manufacturing/Industrial (15.4%) and BFSI (15.2%) segments demonstrated nearly equal market participation. The convergence of record GCC expansion, robust occupancy levels creating space constraints, and a strong deal pipeline positions India’s office market to potentially breach the 100 million square feet leasing threshold within the next two years, representing a transformational milestone for the sector,” said Rahul Arora, Head – Office Leasing & Retail Services, Senior Managing Director (Karnataka, Kerala), India, JLL.

Domestic occupier activity was driven by indigenous flex firms which leased ~18 million sq. ft in 2025 which was their best-performance across years.

On an overall basis, Flex was the leading occupier segment for the second quarter in a row with its share in the Q4 leasing hitting the highest ever at 26.6%, followed by Tech 21.2%. For full year 2025, Tech remained the driver of leasing activity with a 25.8% share, followed by Flex with 21.5%. Manufacturing/Industrial and BFSI had near similar shares of 15.4% and 15.2% in 2025’s leasing volumes. In absolute terms, Flex and Consulting segments had their best-ever year in terms of leasing.

Net absorption breaches all previous predictions to hit 57.0 million sq. ft in 2025; highest ever across all years

In Q4 2025, net absorption was driven by Bengaluru accounting for a sizeable 37.2% share, followed by Hyderabad with 15.7% and Delhi NCR with 14.0% shares, respectively.

“India’s office market delivered exceptional performance in 2025, achieving record-breaking gross leasing of 83.3 million sq. ft and net absorption of 57.0 million sq. ft, with Q4 alone contributing 17.1 million sq. ft in net absorption—the year’s highest quarterly figure. Bengaluru and Delhi NCR led the market with 29.7% and 21.6% shares respectively of total net absorption, while Delhi NCR demonstrated remarkable resilience with 30% year-over-year growth. The entry of nearly 200 new Global Capability Centers (GCCs) over the past two years, and GCCs now representing approximately 50% of all active space requirements, combined with robust occupancies creating space constraints for large occupiers, signals strong portfolio expansion ahead. With this momentum and our strong deal pipeline, India’s leasing volumes are well-positioned to potentially reach the 100 million sq. ft milestone within the next two years,” said Dr Samantak Das, Chief Economist and Head of Research and REIS, India, JLL.

Vacancy drops to 15.2%, down 50 bps Q-o-Q and lowest in five years

It is worth noting that India’s office market continues to defy the global trends of workspace contraction. With the headcount and footprint growth-oriented demand resulting in the strongest net absorption historically for Pan-India, vacancy has now declined to a five-year low with tight, single-digit vacancies prevailing in core markets across all cities. On a q-o-q basis, vacancy declined across all cities. In fact, Bengaluru’s vacancy is now at a four-year low while it is at a historic low in Mumbai and Delhi NCR in the past fifteen years.

Outlook: A strong demand outlook for 2026 with India’s offering of an exceptional market opportunity driven by structural factors creating a sustained growth runway

India successfully bucked the global uncertainties and headwinds to emerge as a stronger office market displaying growth across both headcount and real estate footprint metrics.

Demand from GCCs – both existing ones and new country entrants remains strong, with nearly 200 new GCCs making their way into the country over the past two years. With GCCs making up ~50% of all active space requirements driven by international banking and financial services players’ appetite for offshore operational centres, complemented by the manufacturing sector dynamism fostered through strategic policy initiatives and strong tech R&D background, the growth runway remains intact.

With tight vacancy rates indicating a strong appetite for business expansion and headcount growth driven by its deep and rich talent pool, India is strongly entrenched as a core for market-changing, innovation ideas setting the stage for continued market momentum.