Mumbai, 23 May 2025:
India’s commercial real estate sector is experiencing a significant upswing, defying global macroeconomic headwinds. According to new data from ANAROCK, rental values across India’s top office markets have grown steadily between 2022 and 2025, reflecting rising demand as businesses push for a full-scale return to physical office spaces.
The Mumbai Metropolitan Region (MMR) has emerged as the front-runner, posting the highest rental growth across the country, with a remarkable 28% increase in average monthly office rentals.
Commercial Office Rental Value Growth: 2022 to 2025
| City | 2022 (INR/sq.ft.) | 2023 | 2024 | 2025 | % Growth (2022–2025) |
|---|---|---|---|---|---|
| MMR | 131 | 138 | 155 | 168 | 28% |
| Hyderabad | 59 | 64 | 66 | 72 | 24.1% |
| Delhi NCR | 92 | 94 | 101 | 110 | 20% |
| Bangalore | 82 | 88 | 92 | 95 | 15.8% |
| Pune | 72 | 75 | 76 | 80 | 11.1% |
| Chennai | 66 | 68 | 70 | 72 | 9.1% |
MMR: India’s Most Expensive Commercial Market
With an average monthly rent of ₹168 per sq. ft. in 2025, the Mumbai Metropolitan Region has become the most expensive commercial office market in the country. This marks a 28% increase from ₹131 in 2022.
Demand in MMR continues to be driven by prime micro-markets like:
- Bandra-Kurla Complex (BKC) – financial institutions’ top choice
- Lower Parel – popular with media, corporate offices
- Andheri East – favored by startups and IT/ITES firms
According to Peush Jain, MD – Commercial Leasing & Advisory, ANAROCK Group:
“American firms are playing a pivotal role here. In Mumbai alone, US-based banks and financial services companies account for nearly 48% of BFSI leasing. This reflects their continued confidence in Indian office spaces, particularly high-end, Grade A properties.”
Hyderabad: A Rising Star in the South
Hyderabad recorded the second-highest growth in rentals, rising from ₹59/sq.ft. in 2022 to ₹72/sq.ft. in 2025 — a 24.1% increase. Several factors are behind this surge:
- Relatively affordable rents compared to Mumbai and NCR
- A vibrant IT and tech ecosystem, particularly in HITEC City and Gachibowli
- Proactive government policies to attract investment
- Availability of Grade A office stock at competitive rates
These elements make Hyderabad increasingly attractive for both Indian and global firms.
Delhi NCR: Strong Momentum Driven by Noida & Gurugram
With a 20% rental value increase from ₹92 to ₹110/sq.ft., Delhi NCR has emerged as one of the most active leasing markets. The rise has been powered by:
- Massive infrastructure development (e.g., expressways, metro expansion)
- Growth in Gurugram’s commercial hubs
- High leasing activity in Noida, including large-format offices by tech firms and Global Capability Centres (GCCs)
Delhi NCR captured 23% of all GCC leasing demand in Q1 2025, underlining its rising importance in the national commercial landscape.
Bangalore, Pune & Chennai: Moderate But Stable Growth
- Bangalore saw a 15.8% increase, with rentals rising from ₹82 to ₹95/sq.ft. Prime areas like Whitefield, ORR, and Electronic City continue to attract major tech occupiers.
- Pune’s rental values rose from ₹72 to ₹80/sq.ft. (11.1%). While the growth is modest, the city remains a favorite among IT/ITES and R&D players due to its workforce strength and quality infrastructure.
- Chennai witnessed a 9.1% increase, reaching ₹72/sq.ft. by 2025. Leasing demand here is stable, largely driven by manufacturing, automobile, and IT sectors.
Key Drivers Behind the Surge
- Post-pandemic rebound: Companies are gradually returning to physical office spaces, moving away from purely hybrid models.
- Global Capability Centres (GCCs):
- Accounted for 8.35 million sq. ft. leased in Q1 2025 alone
- Represent over 37% of all leasing in the top 7 cities over the past two years
- Driving transformation of India into a global outsourcing and innovation hub
- Continued interest from global firms:
Especially from American companies, which account for 45% of total office leasing across India — the largest foreign contributor.
Investor Sentiment & Outlook
- Improving rental yields: Especially in markets like Hyderabad and Delhi NCR, where capital values are still competitive.
- Rising popularity of REITs: Retail and institutional investors alike are showing stronger interest in commercial real estate portfolios.
- Strong leasing pipeline: Tech parks, co-working spaces, and SEZs are all seeing sustained demand.
Peush Jain adds:
“The future of work in India is not remote but reimagined. Hybrid work isn’t replacing offices, it’s complementing them. This is reflected in the robust and resilient leasing momentum we’re seeing across the country.”
Conclusion: Demand Outpacing Supply in Prime Markets
As India strengthens its position as a global tech and business destination, and supply remains constrained in key micro-markets, rental values are expected to continue their upward trend. MMR will likely retain its top position, while cities like Hyderabad, Delhi NCR, and Bangalore will drive the next wave of commercial growth.
Also Read: India Commands APAC Office Leasing in 2024, Captures Record 47% Share
