Pune Surges as India's Fastest-Growing Office Market with 188% Growth in H1 2025
Mumbai, 23rd August 2025: India’s commercial office real estate sector witnessed a remarkable 40% year-on-year growth in net office leasing, totaling 26.8 million square feet across the top 7 cities. Pune led the charge with an impressive 188% growth in office absorption.
Commercial Real EstateOffice LeasingPuneReal Estate GrowthMarket DynamicsReal EstateAug 23, 2025
Peush Jain, MD – Commercial Leasing & Advisory, ANAROCK Group, says, “New office supply increased 25% to 24.51 million square feet, creating balanced market dynamics. Vacancy rates improved marginally to 16.3%, and average rentals grew 4% to INR 88 per square foot per month. The IT-ITES sector dominated with 29% market share, followed by co-working spaces at 22%.”
Market fundamentals remain healthy, supported by Global Capability Centre expansion and sustained corporate confidence, positioning the sector for continued growth through 2025.
Key Data:
- Net Office Absorption: 26.8 million square feet in H1 2025, representing a robust 40% year-on-year increase from 19.08 million square feet in H1 2024
- Top Markets: Bengaluru leads with 64% growth, Pune rockets 188% in office absorption and 533% in new supply
- New Office Supply: 24.51 million square feet delivered in H1 2025, marking a 25% growth compared to 19.65 million square feet in the previous year
- Average Office Rentals: INR 88/sq ft per month in H1 2025, reflecting a steady 4% increase and demonstrating stable pricing dynamics despite strong demand
- Office Vacancy: Dips to 16.3%, rentals rise 4% amid strong demand in India’s top cities
- Tech Sector: Drives 29% of leasing share, co-working & BFSI also strong performers
- Market Vacancy Rate: 16.3% in H1 2025, showing marginal improvement from 16.7% in H1 2024, indicating healthy market equilibrium
- Large Transaction Dominance: 57% of all office deals exceeded 0.1 million square feet, up from 52% in H1 2024, reflecting corporate preference for larger consolidated spaces
- Global Capability Centres: GCCs drove office demand in H1 2025, leasing 5.45 million square feet in Bengaluru, 2.81 million square feet in NCR, 2.77 million square feet in Pune, 0.95 million square feet in Chennai, and 1.93 million square feet in Hyderabad
The robust growth in the office market, particularly in Pune, highlights the city's strategic importance in the commercial real estate sector. With strong corporate confidence and expanding global capability centres, Pune is poised to continue its upward trajectory in the coming years.
Frequently Asked Questions
What is the overall growth rate of the commercial office real estate sector in India for H1 2025?
The commercial office real estate sector in India witnessed a 40% year-on-year growth in net office leasing, totaling 26.8 million square feet across the top 7 cities in H1 2025.
Which city emerged as the fastest-growing market in terms of office absorption in H1 2025?
Pune emerged as the fastest-growing market with an impressive 188% growth in office absorption in H1 2025.
What is the current office vacancy rate in India’s top cities as of H1 2025?
The office vacancy rate in India’s top cities dipped to 16.3% in H1 2025, showing a marginal improvement from 16.7% in H1 2024.
Which sector dominated the office leasing market in H1 2025?
The IT-ITES sector dominated the office leasing market with a 29% market share, followed by co-working spaces at 22%.
How much new office supply was delivered in H1 2025, and what was the growth rate compared to the previous year?
24.51 million square feet of new office supply was delivered in H1 2025, marking a 25% growth compared to 19.65 million square feet in the previous year.
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