Bengaluru Leads India's Office Market Despite Traffic Woes; Pune Sees Rapid Growth, Kolkata Slips
Bengaluru continues to lead India's office market, recording nearly 10 million sq. ft. leased in the first nine months of 2025. Pune saw the fastest growth, while Kolkata experienced a decline in office leasing.
BengaluruPuneKolkataOffice MarketReal EstateReal Estate PuneOct 28, 2025
At the same time, Pune emerged as the year’s biggest gainer, with net office absorption nearly doubling to 6.2 million sq. ft., reflecting robust demand from technology firms, BFSI occupiers, and coworking operators expanding in the city’s new business corridors.
By contrast, Kolkata was the only major city to post a decline in office leasing, with absorption falling 19% year-on-year, underscoring the uneven recovery across India’s top seven office markets.
What’s Working for Bengaluru
Despite persistent congestion and infrastructure bottlenecks, Bengaluru remains the top choice for occupiers, led by IT/ITeS, global capability centres (GCCs), and coworking players. IT/ITeS firms alone accounted for 27% of total office space absorption across India, with a large share concentrated in the city’s Outer Ring Road and Whitefield micro-markets.
Bengaluru also saw a 9% rise in rentals, the highest among major metros, while its vacancy rate dropped to 12.2% from 13%, signaling that space additions continue to be quickly absorbed.
Pune: The Fastest-Growing Market
Pune stood out as the fastest-growing office market among the seven cities, posting a 97% year-on-year jump in net absorption and a 168% rise in new completions. The city’s well-balanced occupier mix, from IT/ITeS and engineering firms to BFSI and startups, has made it one of the most dynamic real estate hubs post-pandemic.
Lower rentals compared to Mumbai and Bengaluru, improving connectivity, and a growing base of multinational occupiers have helped Pune transform from a satellite city into a core commercial destination.
Why Kolkata is Struggling
Kolkata’s commercial real estate remained subdued, with net office absorption slipping to 0.85 million sq. ft. in the nine months of 2025 from 1.05 million sq. ft. last year.
Limited Grade-A supply, slower infrastructure development, and a lack of large multinational occupiers continue to weigh on the city’s growth prospects. The vacancy rate remains high at 17.8%, only slightly down from 18.3% in 2024, suggesting sluggish demand.
City-Wise Office Absorption and Vacancy (9M 2025)
| City | Net Absorption (mn sq. ft.) | Change YoY | Vacancy (%) 2025 | Vacancy (%) 2024 |
|---------------|-----------------------------|------------|------------------|------------------|
| Bengaluru | 9.95 | +22% | 12.2 | 13.0 |
| Delhi-NCR | 8.20 | +24% | 22.0 | 23.3 |
| MMR (Mumbai) | 6.60 | +31% | 14.9 | 14.8 |
| Hyderabad | 5.70 | +29% | 26.5 | 26.6 |
| Pune | 6.20 | +97% | 11.9 | 11.5 |
| Chennai | 4.50 | +56% | 8.9 | 9.4 |
| Kolkata | 0.85 | -19% | 17.8 | 18.3 |
| Total (Top 7) | 42.00 | +34% | 16.2 | 16.7 |
Source: ANAROCK Research & Advisory (9M 2025 vs 9M 2024)
Pan-India Snapshot
Across India’s top seven office markets, rentals rose 6% year-on-year to ₹90 per sq. ft., while overall vacancy eased slightly to 16.2%. Net office absorption reached a six-year high of 42 million sq. ft., driven by continued expansion in tech, flexible workspaces, and BFSI.
Hyderabad continued to report the highest vacancy rate at 26.5%, highlighting supply-side pressures in certain micro-markets despite healthy leasing activity. In contrast, Chennai recorded a single-digit office vacancy of 8.9%, the lowest among the top seven metros, reflecting a tight, well-balanced office market with strong demand-supply alignment.
Together, Bengaluru, NCR, and MMR accounted for nearly 60% of total leasing, while Pune and Chennai saw the sharpest growth rates.
Frequently Asked Questions
Which city led India’s office market in 2025?
Bengaluru led India’s office market in 2025, recording nearly 9.95 million sq. ft. leased in the first nine months of the year.
What was the fastest-growing office market in 2025?
Pune was the fastest-growing office market in 2025, with net office absorption nearly doubling to 6.2 million sq. ft.
Why did Kolkata see a decline in office leasing?
Kolkata saw a decline in office leasing due to limited Grade-A supply, slower infrastructure development, and a lack of large multinational occupiers.
What sectors are driving the office market in Bengaluru?
IT/ITeS, global capability centres (GCCs), and coworking players are the main sectors driving the office market in Bengaluru.
What was the overall vacancy rate in India’s top seven office markets in 2025?
The overall vacancy rate in India’s top seven office markets in 2025 was 16.2%, a slight improvement from 16.7% in 2024.
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