The report highlights that multinational corporations—especially from the United States, Europe, and the United Kingdom—are increasingly using India not just as a cost-efficient outsourcing hub but as a strategic base for innovation, research, and advanced operations. This structural shift is expected to significantly boost leasing activity across India’s top seven office markets: Bengaluru, Mumbai, Delhi-NCR, Hyderabad, Chennai, Pune, and Kolkata.

Strong Economic Tailwinds Supporting Growth

India’s macroeconomic outlook is reinforcing investor confidence. The International Monetary Fund recently revised the country’s 2026 GDP growth forecast upward from 6.1% to 6.3%, while projecting 6.5% growth for 2027. Analysts attribute this to robust domestic demand and progress on bilateral trade agreements with key economies such as the US, EU, UK, and France.

These agreements—covering tariff reductions, improved market access, and sector-specific policy easing—are expected to strengthen India’s export competitiveness and encourage foreign companies to scale up their operations locally. Sectors expected to benefit the most include:

• Technology & digital services
• Banking, Financial Services and Insurance (BFSI)
• Engineering & manufacturing
• Consulting and professional services

GCC Leasing on Track to Hit 40 Million Sq Ft Annually

According to Arpit Mehrotra, Managing Director, Office Services at Colliers India, GCC leasing could soon reach 35–40 million sq ft annually, accounting for 40–50% of total office demand.

Since 2020, GCCs have leased about 117 million sq ft, or roughly 38% of India’s total Grade A office absorption. Their annual uptake has nearly doubled—from about 16 million sq ft in 2020 to nearly 30 million sq ft in 2025—reflecting sustained expansion.

US-headquartered firms have dominated activity, contributing nearly 70% of GCC leasing since 2020. However, this dominance is expected to moderate as European and British firms expand their presence.

Distinct Regional Demand Patterns Emerging

The report identifies differing sector preferences among GCC investors:

• US companies: Technology-led demand (47%), followed by BFSI (21%)
• EU companies: Strongly anchored in engineering & manufacturing (~60%)
• UK companies: More diversified, led by BFSI (29%) and consulting (23%)

These trends indicate a broadening occupier mix, reducing reliance on a single sector and strengthening market resilience.

Trade Deals to Accelerate Office Expansion

Tariff reductions and market access provisions under proposed trade agreements are expected to spur corporate expansion. Examples cited include:

• Potential elimination of tariffs on US industrial goods
• EU tariff cuts on machinery, steel, chemicals, and pharmaceuticals
• Reduced auto duties under quota systems for multiple partners

Such measures could make India more attractive as both a manufacturing base and services hub, prompting multinational firms to establish or enlarge capability centres.

From Back Offices to Innovation Hubs

“GCCs will continue to anchor India’s office demand and support diversification of occupiers,” said Vimal Nadar, National Director and Head of Research at Colliers India. He added that while technology will remain a key driver, BFSI and engineering firms could together account for 40–50% of leasing demand in 2026.

This transformation reflects a broader shift: GCCs are no longer transactional support units but high-value hubs handling product development, AI, analytics, and engineering functions. India’s deep talent pool and cost advantages continue to reinforce its appeal as a global operations base.

Also Read: South India’s Data Centre Market to Witness 65% Capacity Growth by 2030

The post GCC Boom Set to Power India’s Office Market: Global Firms May Drive Up to 50% Demand Surge appeared first on Square Feat India.

A sharp year-end surge, strong demand from technology firms and Global Capability Centers (GCCs), and a growing preference for high-quality offices drove this record-breaking performance.

Strong Year-End Push Seals the Record

The final quarter of 2025 proved decisive for India’s office market.

• Q4 leasing hit an all-time high of 20.6 million sq ft,
• marking a 20% jump over the previous quarter.

Bengaluru alone recorded its highest-ever quarterly leasing at 8.1 million sq ft, while Delhi-NCR followed with 4.2 million sq ft. Together, the two cities contributed nearly 60% of India’s total office leasing in Q4, highlighting large deal closures and expansion by major occupiers.

Bengaluru Leads, But Demand Is Broad-Based

While Bengaluru remained India’s largest office market, demand was well distributed across cities:

• Bengaluru: 22.1 million sq ft (nearly one-third of national demand)
• Delhi-NCR, Hyderabad, Chennai & Mumbai: each clocked 10–11 million sq ft
• Pune and Kolkata: also recorded healthy annual growth

This multi-city demand reflects how companies are expanding operations across locations, rather than relying on a single metro.

Technology Firms Power Office Demand

Technology companies remained the biggest drivers of office leasing in 2025.

• Tech firms leased nearly 22 million sq ft of conventional office space
• This marked a 32% YoY increase
• Overall, technology accounted for 37% of total conventional office leasing

Beyond tech, demand was diversified:

• BFSI
• Engineering & Manufacturing
• Consulting

Together, these sectors leased nearly 25 million sq ft, underscoring the broad-based recovery of office demand.

Flex Offices Continue to Gain Ground

Flexible workspaces continued their steady rise in 2025:

• 13 million sq ft leased by flex operators
• 18% share of total office leasing
• Strong adoption in Bengaluru and Delhi-NCR, with notable traction in Pune and Chennai

Hybrid work models, faster market entry, and cost optimisation are driving companies toward flexible and managed office solutions.

GCCs Emerge as a Major Growth Engine

Global Capability Centers (GCCs) played a defining role in India’s office market this year.

• GCCs leased close to 30 million sq ft in 2025
• Accounted for over 40% of total office demand

These centres are no longer limited to back-office work and are now driving advanced functions like AI, cloud computing, analytics, and product development, reinforcing India’s position as a global innovation hub.

Supply Stays Steady, Vacancies Fall

New office supply remained balanced with demand:

• 56.5 million sq ft of new Grade A supply added in 2025
• A 5% YoY increase
• Bengaluru, Hyderabad and Pune together contributed nearly 70% of new completions

With demand outpacing supply:

• Vacancy levels fell by 49 basis points
• Average office rentals increased by up to 15% YoY across major cities

This indicates a clear flight to quality, with occupiers preferring premium and sustainable buildings.

What Lies Ahead for 2026

Industry experts remain optimistic about the outlook for 2026.

According to Colliers:

• Demand from GCCs, technology firms, BFSI, and flex operators will remain strong
• Sustainable and Grade A offices will see higher traction
• Flex spaces could contribute nearly 20% of office demand going forward

With economic growth, talent availability, and corporate expansion working in tandem, India’s office market appears well-positioned for another robust year.

Also Read: 65% of office space in India is green-certified

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Colliers estimates that average annual enterprise seat demand will increase by 25%, reaching nearly 200,000 seats in 2026 and 2027 compared to 160,000 seats in 2024–2025.

Enterprise Demand, GCC Growth Fuel Next Wave

According to the report, technology and BFSI companies will account for 60–65% of enterprise seat uptake, while engineering, manufacturing, and consulting firms are expected to contribute 10–15% each. Enterprise occupiers now account for nearly 70% of total flex demand.

A major shift is the growing dominance of GCCs. They accounted for 40–45% of enterprise seat uptake in 2025, and their share is likely to rise to nearly 50% over the next two years as they scale R&D, analytics, engineering, and AI capabilities in India.

“As domestic enterprises and GCCs deepen their flex adoption, operators are curating next-generation, customized workspaces with advanced PropTech and ESG features. Several operators raising capital through IPOs further reflects strong investor confidence,”
said Arpit Mehrotra, Managing Director, Office Services, Colliers India.

Bengaluru Dominates, Pune Leads in Penetration

With 22.6 million sq ft of operational flex space, Bengaluru remains India’s largest flex market, accounting for 31% of national stock. Delhi NCR follows with 12.5 million sq ft.

Pune stands out for having the highest flex penetration at 11.5%, supported by demand from tech, BFSI, and start-up ecosystems.
Chennai, meanwhile, has recorded an impressive 5.6X growth in flex stock since 2021.

City-Wise Highlights (2025E)

• Bengaluru: 22.6 msf flex stock | 9.7% penetration
• Pune: 9.9 msf | 11.5% penetration (highest)
• Delhi NCR: 12.5 msf | 8.2% penetration
• Chennai: 7.3 msf | 8.2% penetration | 5.6X growth
• Mumbai: 9.7 msf | 7.1% penetration
• Hyderabad: 9.6 msf | 7.7% penetration

Overall, flex stock across India’s top 7 cities has grown 2.4X between 2021 and 2025.

Tech-Enabled, Customised & ESG-Focused Workspaces in Demand

Occupiers increasingly prefer scalable, plug-and-play, managed offices with deep tech integration. Flex operators are upgrading their offerings with:

• Occupier-specific customisation
• PropTech-driven workspace management
• “GCC-as-a-Service” models
• Compliance-ready infrastructure
• Strong ESG features and green-certified buildings

Nearly 70% of flex space uptake in the last 2–3 years has been in green-certified buildings.

Tier II Expansion to Strengthen

While Tier I cities continue to dominate flex absorption—especially Secondary Business Districts (SBDs)—operators are rapidly scaling into Tier II markets such as Ahmedabad, Jaipur, Kochi, Chandigarh, Lucknow, Indore, Bhubaneswar, and Coimbatore.

Seat rentals in these cities are 30–35% lower than Tier I, making them attractive for distributed workforce and hub-and-spoke models. By 2027, Tier II cities could account for 10–15% of India’s flex stock.

“With sustainability features, PropTech adoption and enterprise-grade solutions expanding rapidly, GCCs are expected to drive nearly half of total enterprise demand over the next two years,”
said Vimal Nadar, National Director & Head of Research, Colliers India.

Also Read: Hiring Wave Ahead: Office Space Demand Soars

The post Flex Office Stock to Cross 100 Million Sq Ft by 2027; Penetration to Exceed 10% appeared first on Square Feat India.

This growth is not just a number — it’s the invisible backbone behind the faster deliveries, seamless logistics, and growing online shopping ecosystem that millions of Indians rely on every day.

Why Warehouses Matter to You

When you place an online order, stock up on groceries, or receive a new appliance — the journey begins in these warehouses.
Modern logistics parks today are hubs for:

• E-commerce fulfilment: Storing, sorting, and dispatching lakhs of orders daily.
• Engineering & manufacturing supply chains: Housing raw materials and finished goods.
• Third-party logistics (3PL): Outsourced storage and transport partners who keep the supply chain moving efficiently.

These facilities, strategically located near highways and city peripheries, make it possible for goods to reach homes and businesses within hours.

Key Highlights of the 2025 Performance (Jan–Sep)

• Record Demand: 26.5 million sq. ft. leased — up 11% YoY, highest ever for this period.
• Top Cities Driving Growth: Delhi NCR, Chennai, and Mumbai together account for over 60% of total demand.
• Sector Mix:
  • 3PL firms lead with one-third of total leasing.
  • Engineering sector contributes 20%, while E-commerce follows at 15% — a 2.5x increase over last year.
• New Supply: 28.8 million sq. ft. of new space delivered — up 6% YoY.
• Vacancy: Rose by 160 bps in Q3 as new supply slightly outpaced demand.

Where the Action Is

Major warehousing clusters are concentrated in:

• Bhiwandi (Mumbai) — a traditional logistics hub close to Mumbai city.
• Oragadam (Chennai) — driven by engineering and manufacturing.
• Hoskote (Bengaluru) — popular for large tech and automotive warehousing.
• Luhari & Farukh Nagar (Delhi NCR) — preferred by 3PL and e-commerce giants.

Developers are betting big on these locations due to their connectivity to major highways, robust infrastructure, and proximity to consumption centres.

Q3 2025 — A Temporary Slowdown

After a record-breaking Q2, demand in Q3 2025 moderated to 7 million sq. ft., down 23% YoY. This dip is being seen as a temporary breather before the festive season surge, which typically drives warehousing requirements for e-commerce, electronics, and FMCG firms.

Even as vacancy levels rose slightly, rentals in prime micro-markets remained firm, indicating occupiers’ continued preference for top-quality, sustainable spaces.

Expert View

“The sector’s resilience is remarkable. Large deals continue to drive leasing activity, with 3PL and e-commerce segments at the forefront. We expect warehousing demand to pick up further in the festive quarter, building on the strong volumes seen earlier this year,”
— Vijay Ganesh, Managing Director, Industrial & Logistics Services, Colliers India

What This Means for Consumers and Businesses

• Faster Deliveries: More warehouses near consumption hubs = shorter delivery times.
• Stable Prices: Efficient supply chains reduce logistics costs, helping businesses manage inflation.
• Job Creation: Warehousing clusters generate local employment in operations, transport, and support services.
• Infrastructure Growth: Industrial hubs spur development of roads, power, and connectivity in surrounding areas.

In short, while you might never step inside a logistics park, it’s quietly shaping your everyday life — from same-day delivery promises to ensuring your neighbourhood kirana never runs out of stock.

Also Read: Bhiwandi: Logistic firm Rents Property for ₹85 lac a month

The post 🏭 India’s Warehousing Boom Hits Record High: 26.5 Million Sq. Ft. Leased in 9 Months — Powering E-commerce & Everyday Deliveries appeared first on Square Feat India.

New Delhi, 17 July 2025 — India’s industrial and warehousing sector has witnessed a historic first half of the year, with Grade A space leasing touching 19.5 million sq ft across top eight cities — marking a 33% year-on-year (YoY) growth, according to Colliers India.

Key Highlights: H1 2025 Industrial & Warehousing Trends

City-Wise Performance in Grade A Leasing – H1 2025

Bhiwandi (Mumbai) was the most active micro market with 3.1 mn sq ft space take-up, followed by Oragadam (Chennai) at 1.5 mn sq ft.

Demand Drivers: 3PL Still Dominates, Engineering & E-commerce Catch Up

Third Party Logistics (3PL) companies led leasing activity with 32% share.
Engineering, E-commerce, and Auto sectors also saw robust leasing, each contributing 10–20% of total demand.

“This heterogeneity of demand reflects the sector’s resilience and aligns with India’s broad-based economic growth,”
– Vimal Nadar, National Director & Head of Research, Colliers India

Larger Deals (200,000+ sq ft) Account for Half of All Leasing

About 51% of all leases in H1 2025 came from large format deals.
Delhi NCR and Mumbai led in big-ticket transactions.
Most large deals came from 3PL, e-commerce, and engineering occupiers.

New Supply Keeps Pace with Demand

India added 19.4 mn sq ft of Grade A warehousing in H1 2025 — a strong 11% annual rise, matching leasing levels and reflecting developer confidence.

Grade A Supply by City – H1 2025

“Q2 2025 alone saw 10 mn sq ft of completions — the highest quarterly addition in recent years,”
– Vijay Ganesh, Managing Director, Industrial & Logistics Services, Colliers India

Outlook for 2025: 35–40 Mn Sq Ft of New Supply Expected

With rising absorption and high-quality Grade A developments underway, total new supply for 2025 is expected to reach 35–40 mn sq ft. The sector is well positioned for continued expansion in H2 2025, especially in key logistics hubs.

Also Read: Warehousing & Logistics sector shows resilience amidst Investment drought 

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Total institutional investments in Indian real estate stood at USD 3.0 billion in H1 2025

Q2 2025 Registers a 29% Uptick Over Q1 2025

After a relatively slow Q1, Q2 2025 saw a significant rise in investment flows, touching USD 1.7 billion, up 29% sequentially.

“Domestic capital has emerged as a key driver in India’s real estate investments… Their growing dominance has helped cushion the impact of global uncertainties.”
— Badal Yagnik, CEO, Colliers India

Domestic vs Foreign Investments (USD Million)

“Despite a drop in foreign capital, total investments remain above the half-yearly average of USD 2.6 billion since 2021.”
— Colliers Report

Asset Class-Wise Investment Trends

“The residential segment continued its strong run… The retail sector is also witnessing a steady revival.”
— Vimal Nadar, Head of Research, Colliers India

* Alternate assets include: data centers, life sciences, student housing, schools, senior housing, and holiday homes.

City-wise Investment Performance

“Mumbai and Bengaluru together accounted for 39% of total inflows, led by residential and office deals. Retail emerged strong in Kolkata due to large transactions.”

Key Highlights at a Glance

• USD 3.0 Bn institutional investments in H1 2025 (↓15% YoY)
• Domestic investors: USD 1.4 Bn, ↑53% YoY
• Foreign investors: USD 1.6 Bn, ↓39% YoY
• Top segments: Residential (27%), Office (24%), Mixed-use (21%)
• Top cities: Mumbai (22%), Bengaluru (17%), Kolkata (13%)

Also Read: Indian Real Estate: Riding Higher in 2025

The post Indian Real Estate Attracts USD 1.4 Bn from Domestic Investors in H1 2025 appeared first on Square Feat India.

Macro View (Top 7 Cities vs High‑Activity Markets)

Source: Colliers Research

Top 15 High‑Activity Micro Markets

Green micro markets indicate sub‑dollar rentals (~ INR 90/sf/mo).

Why These Markets Matter

• Demand & Supply Scale: Each micro market averages ≥ 1 msf annual demand and supply; collectively forecast to drive 80%+ of India’s future office activity.
• REIT Potential: With 488 msf REIT-worthy nationally, 56% lies within top 10 micro markets, and 72% of their Grade A stock is ready for REIT listings.
• Financial Hubs: Flexible workspace (flex) uptake in these areas soared from 1.3 msf (2020) to 7.3 msf (2024) at a CAGR of 54%; 73% of GCC leasing (~70 msf) also centered here.
• Rental & Vacancy Benefits: Premium rental zones in Mumbai and Delhi NCR enjoy sub-10% vacancies—well below ~16% national average.
• Sustainability Edge: Green-certified offices are gaining preference, providing higher occupancy and yield.

Expert Opinions

“Annual demand and supply in each of these high-activity micro markets is likely to exceed one million sq ft…”
— Arpit Mehrotra, MD, Office Services, Colliers India

“These zones will lean toward landlord-favorable terms and attract premium and green-certified developments.”
— Vimal Nadar, National Director & Head of Research, Colliers India

Mini Insights Box

• Micro Markets Count: 15 across 7 cities
• Rent Types: ~60% are near or sub‑dollar
• Flex Space Demand: 59% of national uptake in top 10 zones
• GCC Focus: 73% of leasing in top 10 markets
• REIT-Ready Inventory: 72% readiness in top 10 micro markets

Outlook

India’s office landscape is reshaping around these high-activity micro markets, which offer scale, value, and investor appeal. With sustained growth, REIT upside, flex trends, and green adoption, these zones are set to define the future of India’s commercial real estate.

Also Read: Indian office real estate performs better in Asia Pacific.

The post India’s Office Boom Narrows to 15 Hotspots appeared first on Square Feat India.

India’s total data center (DC) capacity stands at 1,263 MW as of April 2025 and is projected to quadruple to over 4,500 MW by 2030, supported by large-scale investments of USD 20–25 billion in the next 5–6 years. This growth is expected to push the DC real estate footprint from the current 15.9 million sq ft to ~55 million sq ft by 2030, according to Colliers India.

 Mumbai: India’s Digital Infrastructure Capital

Mumbai accounts for 41% of India’s current DC capacity and has added 44% of new supply since 2020, making it the undisputed leader in India’s data infrastructure growth story.

Mumbai’s advantages include:

• Proximity to submarine cable landing stations
• Stable power availability
• Strong real estate ecosystem
• Global enterprise and fintech presence

 India’s National DC Expansion

India’s top 7 cities — Mumbai, Chennai, Delhi NCR, Hyderabad, Bengaluru, Pune, and Kolkata — are driving the expansion. Here’s how:

 Bigger and Smarter Data Centers

India’s DC landscape is evolving toward large-scale hyperscale facilities. The share of data centers larger than 50 MW is projected to grow to nearly two-thirds of total capacity by 2030.

 Global Relevance: Why This Matters

India’s rise in the DC space is not just domestic growth — it’s reshaping the global digital supply chain.
India is now seen as a strategic alternative to data hubs like Singapore and Hong Kong due to:

 Investment Landscape

India’s DC industry has already attracted USD 14.7 billion since 2020 and is poised to draw another USD 20–25 billionthrough 2030, with major players expanding into Tier II & III cities to tap regional digital consumption.

 Sustainability on the Agenda

Green-certified DCs currently account for 25% of the market. This is expected to rise to 30–40% by 2030 as developers shift toward renewable energy, efficient cooling systems, and low-carbon infrastructure.

 Industry Insights

“Mumbai has emerged as the cornerstone of India’s digital infrastructure. With submarine connectivity, skilled talent, and enterprise demand, it leads India’s journey toward becoming Asia-Pacific’s most scalable data center market,”
— Jatin Shah, COO, Colliers India

“The next 5 years will define India’s DC evolution — not just in volume but in quality, sustainability, and global relevance,”
— Vimal Nadar, Head of Research, Colliers India

 Conclusion: India, Powered by Mumbai, Is Now a Global DC Destination

With its unmatched growth trajectory, favorable ecosystem, and strong city-level leadership from Mumbai, India is set to become a global data command center — enabling AI, cloud, fintech, and digital services across the world. This isn’t just about infrastructure — it’s about India’s digital influence on the global economy.

Also Read: India’s Data Centre Market Sees $6.5 Billion Investment Surge, 139% Capacity Growth in a Decade

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