From Bengaluru to Pune: India's Office Market Surges Despite Challenges
India's office market has shown remarkable resilience and growth in 2025, despite facing significant challenges such as global trade tensions and IT layoffs. According to the latest ANAROCK research data, net office leasing across India’s top seven cities hit an all-time high of approximately 55 million square feet (Mn sq. ft.), a 10% year-on-year increase from 49.95 Mn sq. ft. in 2024.
This surge in demand signals a strong recovery and confidence in India Inc., with the office real estate cycle firmly back in growth mode. The market's resilience is particularly noteworthy given the macroeconomic uncertainties and the impact of global tariffs.
Bengaluru, traditionally the leading market, leased approximately 14.15 Mn sq. ft. in 2025, the highest among all cities. However, it saw a 5% year-on-year dip in net leasing, which is a slight deviation from the national trend. Despite this, Bengaluru remains a dominant player in the office leasing market, with a significant share of new office supply, adding around 13.5 Mn sq. ft. in 2025.
Pune emerged as the fastest-growing market, recording a massive 63% jump in net leasing from 4.8 Mn sq. ft. to approximately 7.8 Mn sq. ft. The city also saw the sharpest surge in new office supply, contributing to the overall growth of the market. This rapid growth in Pune indicates a shift in the traditional office market dynamics, with emerging cities gaining prominence.
The top seven cities added approximately 51.83 Mn sq. ft. of new office space in 2025, marking an 8% overall increase. While Bengaluru led in new office supply, the MMR and Hyderabad regions saw a decline in supply, reflecting regional variations in market dynamics.
The demand for office space was primarily driven by the IT/ITeS sector, which accounted for a 27% share of leasing. Coworking spaces and BFSI (Banking, Financial Services, and Insurance) followed closely, with 23% and 18% shares, respectively. The rise of flex spaces continues to gain ground across major office hubs, offering more flexible and cost-effective solutions for businesses.
Office vacancy rates in top cities eased to 16.10% from 16.50% in the previous year, indicating a healthier market with fewer vacant spaces. Average monthly rents climbed 6% to Rs 92 per sq. ft., with Bengaluru experiencing a notable 9% increase. This rise in rentals reflects the strong demand and limited supply in key markets.
Looking ahead, the office real estate market in India is poised for continued growth in 2026. Strong leasing activity, rising rentals, and robust demand from key sectors signal a positive outlook for the industry. The market's ability to navigate through global and local challenges underscores the resilience and potential of India's real estate sector.
