India's Office Market Reaches USD 186 Billion Valuation; Focus on New Assets Needed
India's office space stock has surpassed one billion square feet, valued at USD 186 billion, according to a report by CII and Knight Frank India. However, the market needs to focus on building new properties to sustain its growth.
IndiaOffice MarketReal EstateCiiKnight FrankReal EstateOct 31, 2025
Industry body CII and real estate consultant Knight Frank India released a comprehensive report on commercial real estate on Friday. The report highlights that India is now the fourth-largest office market globally, having crossed the 1 billion square feet threshold in total office stock. The office stock is currently valued at approximately Rs 16.4 trillion (USD 186 billion), demonstrating the sector's depth and resilience.
From under 200 million square feet in the early 2000s to 1 billion square feet in 2025, this remarkable expansion underscores India's emergence as one of the fastest-growing and most future-ready office markets in the world. The consultant noted that gross leasing of office space surpassed 70 million square feet in 2024 and has already reached 67 million square feet in the first nine months of 2025, underscoring the market's structural strength despite global macroeconomic uncertainties.
At this juncture, the Indian office market stands at a pivotal inflection point. The combination of limited new supply, surging occupier demand, and cautious developer sentiment is setting the stage for a period of rental appreciation, valuation uplift, and strategic recalibration. To sustain its growth momentum and achieve the next milestone of 2 billion square feet of office stock, the CII-Knight Frank report suggested that India must adopt a twin-pronged strategy: accelerate new supply creation while enhancing the productivity of existing assets.
The acute undersupply in India's office real estate market is not just a function of post-COVID caution; it is increasingly driven by project-level economics that favor residential over commercial development. The consultant noted that residential capital values per square foot across prime micro-markets have significantly outpaced those of comparable commercial projects, sometimes by more than 2-3 times.
To address this challenge, the report recommends several key strategies, including policy reforms to incentivize commercial development, improving infrastructure, and enhancing the ease of doing business. These measures are crucial for ensuring that the Indian office market continues to grow and attract both domestic and international investors.
Frequently Asked Questions
What is the current value of India's office space stock?
India's office space stock is currently valued at approximately USD 186 billion.
How much has India's office space stock grown since the early 2000s?
India's office space stock has grown from under 200 million square feet in the early 2000s to over 1 billion square feet in 2025.
What are the key challenges facing the Indian office market?
The key challenges include limited new supply, surging occupier demand, and cautious developer sentiment, leading to a period of rental appreciation and valuation uplift.
What strategies does the CII-Knight Frank report suggest to sustain the growth of the Indian office market?
The report suggests a twin-pronged strategy: accelerating new supply creation and enhancing the productivity of existing assets, along with policy reforms, improved infrastructure, and enhanced ease of doing business.
Why is there a preference for residential development over commercial in India's real estate market?
Residential capital values per square foot across prime micro-markets have significantly outpaced those of comparable commercial projects, sometimes by more than 2-3 times, making residential development more economically attractive.
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