Green Certified Stock: A Majority Stake in Grade A Offices

As of H1 2025, approximately 530 million sq. ft. of the 865 million sq. ft. total Grade A office stock in the top 7 cities is green-certified, translating to a dominant 61% share. This is a significant leap from 322 million sq. ft. in 2019.

City-wise Leaders in Green Stock:

• Bengaluru leads with approx. 163 Mn sq. ft., accounting for 73% of its total 223 Mn sq. ft. office stock
• NCR follows with 97 Mn sq. ft. (62% of total office stock)
• Hyderabad has 87 Mn sq. ft. (62%)
• MMR: 67 Mn sq. ft. (47% of 144 Mn sq. ft. stock)
• Chennai, Pune: Moderate shares
• Kolkata lags with just 3% green-certified stock

Leasing Momentum Driven by Sustainability

Out of the total 26.8 Mn sq. ft. of net absorption in H1 2025, over 74% (19.93 Mn sq. ft.) was leased in green-certified buildings — underscoring the occupier shift towards eco-conscious workspaces.

City-wise Green Leasing Share in H1 2025:

• Bengaluru: 80% (5.3 Mn sq. ft. of 6.6 Mn sq. ft.)
• NCR, Pune, Chennai: ~76%
• MMR: 72%
• Hyderabad: 69%
• Kolkata: Just 7%

Green Premium: Higher Rents, Lower Vacancies

Despite higher costs, green buildings are in demand:

• Green-certified offices command up to 24% higher rentals.
• Average monthly rent in MMR:
  • Green: INR 177/sq. ft.
  • Non-green: INR 143/sq. ft.
• Chennai sees a 16% premium; Kolkata has the smallest gap at 4%.

Vacancy Comparison:

• PAN India Vacancy:
  • Green: 14%
  • Non-Green: 16.30%
• MMR Green Vacancy: 8% vs 15.1% (non-green)
• Chennai Exception: Green-certified buildings have higher vacancy (13%) than non-green (9.10%)

Sustainability Push: From Policy to Practice

Anuj Puri, Chairman, ANAROCK Group, emphasized that the surge in green offices is not just developer-driven but also policy-backed and demand-led. Multinational companies, Global Capability Centers (GCCs), and large corporates are mandating sustainability in leasing decisions.

“Green office buildings are India’s sustainability vanguard,” Puri noted. “The demand for eco-friendly commercial spaces far outpaces that for green residential housing.”

He added that India’s commitment to net-zero emissions by 2070 and a 500 GW renewable energy capacity by 2030 makes the green commercial segment a strategic imperative.

Global Competitiveness Through Green Real Estate

With international tenants prioritizing green-certified workspaces, India’s rapid adoption of sustainable office stock enhances its global competitiveness. The shift positions India as a hub for responsible business, aligning climate action with economic growth.

Also Read: Commercial Real Estate Leads in Green Buildings.

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Gauri Shankar Nagabhushanam, CEO of CapitaLand India Trust Management Pte. Ltd., stated that the 5-star rating confirms CLINT’s sustainability efforts and commitment to responsible business practices and environmental sustainability. CLINT integrates sustainability at all stages of the real estate life cycle, from investment to operations. As of December 2023, 99% of its business parks portfolio is green certified, and it has reduced Scope 1 and 2 carbon emissions intensity by 52% compared to its 2019 baseline.

The adoption of renewable energy plays a key role in CLINT’s decarbonisation strategy, which aligns with CapitaLand Investment’s commitment to achieve Net Zero carbon emissions for Scope 1 and 2 by 2050. Approximately 39% of CLINT’s energy consumption comes from renewable sources. In January 2024, a 21-megawatt solar plant was established in Tamil Nadu to enhance green power usage. Additionally, 63% of CLINT’s loans are sustainability-linked.

The GRESB Real Estate Assessment serves as a global benchmark for ESG performance and sustainability practices in the real estate sector. Alongside the 5-star rating, CLINT has received other recognitions this year, including the Corporate Sustainability Award at the Securities Investors’ Association Singapore (SIAS) Investors’ Choice Awards 2024 and an ESG ‘A’ rating from MSCI. CLINT also won a ‘Gold’ award for Annual Report in the REITs & Business Trusts category at the Singapore Corporate Awards 2024.

Also Read: Residential Demand Rises 12.3% QoQ with 8.3% Capital Appreciation

The post CapitaLand India Trust Achieves 5-Star Rating in 2024 GRESB Real Estate Assessment appeared first on Square Feat India.

In Q2 2024 alone, approximately 13 million square feet of office space was leased in green-certified buildings across the top six cities, marking a significant 24% year-over-year increase and an impressive 82% share of total leasing activity for the quarter. Bengaluru and Mumbai emerged as leaders in this trend, together accounting for over 50% of the green-certified leases in the quarter. Notably, about 60% of these leases were in relatively new developments constructed in the past five years.

Growing Green Certification Among Occupiers

The shift towards green office spaces is driven by an increasing awareness among corporate occupiers of the role that sustainable buildings play in addressing climate change. Prominent green certifications such as LEED, GRIHA, and WELL are becoming more sought after as they offer benefits like lower operational costs, improved indoor air quality, and enhanced employee productivity.

“Over the last few quarters, developers, investors, and occupiers in the office market have increasingly embraced the adoption of sustainable elements in their portfolios. With 13 million square feet of leasing in green-certified buildings in Q2 2024, a significant 82% of occupiers were inclined towards green-certified buildings. This reflects occupiers’ strong commitment to align their sustainability goals with the broader sustainability targets of the country,” said Arpit Mehrotra, Managing Director, Office Services, India at Colliers.

Sector-Specific Trends

Technology and Engineering & Manufacturing firms are at the forefront of this green shift, with about 80% of their leasing activity in green-certified buildings since 2023. Additionally, 62% of flexible workspace providers also prefer green-certified locations. The technology sector alone accounted for 27% of the green-certified leasing, followed closely by Engineering & Manufacturing and BFSI sectors.

City-wise data highlights:

• Bengaluru: 68% of leasing in green-certified buildings, with Engineering & Manufacturing leading.
• Chennai: 79% of leasing in green-certified buildings, predominantly by the Technology sector.
• Delhi NCR: 74% share, with Technology firms driving the trend.
• Hyderabad: 76% share, largely due to Technology firms.
• Mumbai: 72% share, with BFSI sector leading.
• Pune: 71% share, with BFSI sector prominent.

Expansion of Green Office Stock

The green office stock is set to grow substantially. As of June 2024, approximately 67% of Grade A office buildings in the top six cities were green-certified. With nearly 70% of new Grade A office completions in Q2 2024 being green-certified, the trend is expected to continue. Over the next 2-3 years, the green-certified Grade A office stock is projected to exceed 600 million square feet.

“With increased inclination among occupiers for green-certified buildings, several Grade A developers are boosting their sustainable offerings. During Q2 2024, nearly 70% of new supply was green-certified. Developers are also retrofitting older office buildings to meet green standards. About 300-350 million square feet of commercial building stock older than 10 years have the potential for refurbishment, further expanding the green-certified office inventory,” noted Vimal Nadar, Senior Director and Head of Research at Colliers India.

The surge in green office space leasing and development reflects a broader shift towards sustainability in India’s commercial real estate sector, highlighting a significant step towards meeting environmental, social, and governance (ESG) goals.

Also Read: Industrial & warehousing demand remains healthy with about 13 mn sq ft of leasing in H1 2024

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