India Office Space Supply Set for Decade High Amid Strong Demand
Overview
Indian cities anticipate the highest office space supply in a decade, with 90 million sq ft expected by 2026-2027. Despite this surge, demand remains robust, driven by GCCs and a focus on premium, green-certified spaces, keeping vacancy levels tight and rental growth range-bound in prime markets.
India Braces for Record Office Space Influx
India's major cities are poised to witness an unprecedented surge in office space supply over 2026 and 2027. Developers are set to deliver up to 90 million square feet of new office space, a volume that doubles the annual average of recent years and represents the highest influx in a decade. This comes as construction momentum, which slowed post-Covid, picked up significantly in 2022.
Demand Continues to Outpace New Supply
Despite the impending supply boom, demand remains exceptionally strong. Office leasing activity hit a record high for the third consecutive year in 2025, reaching 82.6 million square feet, a trend expected to persist into 2026. Experts note that prime micro-markets in major cities are still struggling to match absorption rates.
Key Cities Lead Completions
Bengaluru, Delhi-NCR, and Hyderabad are expected to account for over 60% of the new office completions. This large addition of Grade-A office space, fueled by steady demand from Global Capability Centers (GCCs) and a continued focus on established business districts, is likely to offer occupiers more choices and keep vacancy levels slightly elevated in the short term.
Rental Growth Expected to Stabilize
Consequently, rental growth is anticipated to remain largely range-bound. Only high-quality assets situated in prime micro-markets may experience a limited upside. The market is entering a phase of supply revival after a period where new construction lagged demand due to pandemic-induced disruptions.
Quality and Sustainability Drive New Developments
The upcoming supply is distinctly quality-focused, with a significant share comprising Grade A+ developments in prime locations. Developers are prioritizing fully amenitised, premium, green-certified office spaces that align with occupiers' needs for operational scalability, employee well-being, and ESG commitments. Sustainability features like energy-efficient design and renewable energy integration are becoming standard.
