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India’s office leasing market saw a significant increase in the first half of 2025, with net office absorption rising 40% year-on-year to 26.8 million square feet across the top 7 cities, according to a report by Anarock.

The growth was driven by the tech and Global Capability Centre (GCC) sectors, which are increasingly playing a major role in India’s commercial office real estate market. GCCs, which are captive centres set up by multinational companies to leverage India’s talent pool and cost advantages, have been a key driver of demand for office space in the country.

Bengaluru maintained its market leadership position, with 6.55 million square feet of absorption, while Pune saw a significant growth of 188% in office absorption. The city also saw a 533% increase in new supply, indicating a strong demand for office space.

According to Peush Jain, MD – Commercial Leasing & Advisory, Anarock Group, “The IT-ITES sector dominated the market with a 29% share, followed by co-working spaces at 22%. The market fundamentals remain healthy, supported by GCC expansion and sustained corporate confidence, positioning the sector for continued growth through 2025.”

The report also noted that 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 Rs 88 per square foot per month.

GCCs were a significant driver of office demand in H1 2025, with Bengaluru leasing 5.45 million square feet, followed by NCR (2.81 million square feet), Pune (2.77 million square feet), Chennai (0.95 million square feet) and Hyderabad (1.93 million square feet). This growth is a testament to India’s attractiveness as a destination for GCCs, with many multinational companies setting up or expanding their operations in the country.

The growth of GCCs in India can be attributed to the country’s large talent pool, favourable business environment and cost advantages. Many companies, including tech giants and financial institutions, have set up GCCs in India to leverage the country’s skilled workforce and improve their global competitiveness.

The report also highlighted the dominance of large transactions in the office leasing market, with 57% of all deals exceeding 0.1 million square feet, up from 52% in H1 2024. This reflects corporate preference for larger consolidated spaces, driven by the need for more efficient and productive work environments.