Indian Office Space Sector Set for Remarkable Growth - 165 Million Sq Ft Supply Expected by 2025

New Delhi:

The Indian office space market is gearing up for a substantial surge between 2023 and 2025, defying global economic uncertainties. Developers remain optimistic as the sector prepares to welcome over 165 million sq. ft. of new office space by 2025, surpassing the 142 million sq. ft. built in the past three years, as revealed in a report by CBRE.

Leading the charge in this expansion, Bengaluru and Hyderabad are expected to maintain their dominance in the supply of office spaces, collectively accounting for nearly half of the total supply among the top seven cities.

While many global corporations are downsizing their offices, India stands as an outlier, boasting robust leasing activity. In 2022 alone, the nation recorded a staggering 56.6 million sq. ft. of absorption, marking a remarkable 40% increase from the previous year and the second-highest leasing activity ever, only trailing behind the peak in 2019 when it reached 65 million sq. ft.

Furthermore, a consistent supply of approximately 120 million sq. ft. of office space is anticipated between 2026 and 2027.

Anshuman Magazine, CEO, India, Southeast Asia, Middle East & Africa, CBRE, stated,

Experts predict that with sustained technology investment from corporations, India will continue to be recognized as the 'office of the world.' The country's cost-effectiveness and scalability advantages will entice global corporations to establish more Global Capability Centers (GCCs) across various sectors.

Between 2023 and 2025, Bengaluru is poised to lead the office space supply, contributing 29% of the total supply in India. It will be followed by Hyderabad at 20%, Delhi-NCR at 17%, Pune at 12%, Chennai at 11%, Mumbai at 9%, and Kolkata at 2%.

Highlights:

The Indian office space market's resilience and growth in the face of global economic challenges are noteworthy. The anticipated supply of 165 million sq. ft. by 2025 signals continued confidence in the sector's potential. This growth is not only a testament to India's attractiveness as a business destination but also reflects the adaptability and innovation displayed by the real estate industry.

The consistent increase in office space supply and leasing activity demonstrate the enduring demand for commercial real estate in India. With corporations continuing to invest in technology and establish GCCs, the country is poised to play a pivotal role in the global business landscape.

Bengaluru's dominant position as a supply leader underscores its status as India's leading tech and business hub. It is expected to play a crucial role in driving the nation's office space expansion, followed closely by other major cities. This growth bodes well for developers, occupiers, and the overall economic landscape.

In conclusion, India's office space sector is not only resilient but also thriving, offering exciting opportunities for investment and expansion. As the world increasingly relies on Indian talent and infrastructure, the nation's position as the 'office of the world' is poised to strengthen further."