India's Commercial Real Estate Surges: Top Cities Driving the Growth
From 2022 to 2025, India's commercial real estate market has seen significant growth, with Mumbai leading the pack with a 28% increase in rental values to INR 168 per sq. ft. Hyderabad follows with a 24.1% rise, highlighting robust post-pandemic demand.
Commercial Real EstateIndiaMumbaiHyderabadOffice RentalsReal Estate MumbaiMay 24, 2025
The Mumbai Metropolitan Region (MMR) emerged as the frontrunner, experiencing a significant 28% rise in office rental values, climbing from INR 131 per sq. ft. in 2022 to INR 168 in 2025. This surge underscores MMR's position as India's most expensive commercial market, driven by robust demand from sectors such as finance, IT/ITeS, and startups, particularly in prime micro-markets like Bandra-Kurla Complex and Andheri East.
Hyderabad showcased the second-highest growth rate at 24.1%, with rental values increasing from Rs 59 to 72 per sq. ft. over the same period. The city's affordability, proactive government policies, and thriving IT corridor have contributed significantly to its appeal among occupiers seeking cost-effective yet strategic business locations.
Delhi NCR also registered substantial growth, marking a 20% increase in office rental values, driven by infrastructure projects and rising demand in Noida and Gurugram. Bangalore, known as India's tech capital, saw a 15.8% rise, with key areas like Whitefield and Electronic City attracting global occupiers. Meanwhile, Pune and Chennai reported moderate growth rates of 11.1% and 9.1%, respectively, reflecting steady expansions in their IT/ITES and industrial sectors.
Steady growth in rental yields has bolstered investor confidence, particularly in Hyderabad and Delhi NCR, where competitive capital values continue to attract investment. The rise in Real Estate Investment Trusts (REITs) and a return to pre-pandemic office absorption levels signal optimism despite global challenges.
Peush Jain, MD - Commercial Leasing & Advisory at ANAROCK Group, highlighted, "The evolution of India's commercial real estate market reflects a reimagined future of work, blending physical and flexible spaces. This transformation has sustained a strong leasing pipeline across tech parks, co-working hubs, and Special Economic Zones (SEZs), ensuring continued growth in rental values amid supply constraints."
As India solidifies its position as a global outsourcing hub, the trajectory of office rental values remains poised for consistent growth across key metropolitan markets.
Frequently Asked Questions
Which city in India has seen the highest increase in commercial rental values?
Mumbai has seen the highest increase in commercial rental values, with a 28% rise from INR 131 per sq. ft. in 2022 to INR 168 in 2025.
What factors are driving the growth in Hyderabad's commercial real estate market?
Hyderabad's growth is driven by its affordability, proactive government policies, and a thriving IT corridor, making it an attractive location for occupiers seeking cost-effective business locations.
How has the Delhi NCR region performed in terms of commercial rental growth?
Delhi NCR has registered a substantial 20% increase in office rental values, driven by infrastructure projects and rising demand in areas like Noida and Gurugram.
What role do Real Estate Investment Trusts (REITs) play in the Indian commercial real estate market?
REITs are playing a significant role by attracting investment and boosting investor confidence, particularly in cities like Hyderabad and Delhi NCR, where competitive capital values are prevalent.
What is the outlook for India's commercial real estate market in the coming years?
The outlook for India's commercial real estate market is positive, with continued growth expected across key metropolitan markets, driven by robust demand and a reimagined future of work that blends physical and flexible spaces.
Related News Articles
Signature Global Aims to Achieve ₹10,000 Crore in Pre-Sales for FY25
The company expects to achieve ₹10,000 crore of pre-sales in 2024-25, with a sustained supply of projects in Sector 71 and other locations.
RERA Act vs Consumer Protection Act: Understanding the Law and Jurisdiction
Know your rights under RERA Act and Consumer Protection Act. Understand the jurisdiction and proper authorities to approach for grievances.
DDA Housing Scheme 2024: Your Dream Home in Delhi for Just Rs 11 Lakh!
Delhi Locations: Sector 14, 16B, and 19B in Dwarka. Categories: HIG, MIG, and LIG.
Bollywood Celebrities Spark Real Estate Boom in India
Square Yards, a leading proptech company, has observed that the acquisition of properties, whether commercial or residential, by Bollywood celebrities often boosts market sentiment and drives a surge in real estate transactions across the country.
Metro Brand Promoters Acquire 5 Luxury Flats in Palais Royale for ₹405 Crore
Mumbai's luxury real estate market sees a significant boost as Metro Brand Promoters make a massive property investment in the iconic Palais Royale, signaling a strong confidence in the city's premium property sector.
The 14th Edition of the Gera Pune Residential Realty Report Reveals Market Trends
Pune (Maharashtra) [India], January 9: Gera Developments Private Limited (GDPL), a leading name in premium residential and commercial real estate, has released its 14th annual Pune Residential Realty Report, highlighting the significant shifts in the city