India Office Leasing Holds Steady at 66.7 Mn Sq Ft in 9M CY2026 as GCCs Gain Ground: Knight Frank India
Mumbai : Knight Frank India, the leading international property consultancy, in its latest assessment of the Indian office market, reported that India’s office leasing remained resilient in the first nine months of 2026 (9M CY2026) , with transactions across the eight key markets reaching 66.7 million square feet (mn sq ft), mirroring the levels recorded in the corresponding period last year. The report also highlights a notable shift in the composition of this demand, with Global Capability Centres (GCCs), flex operators and India-facing businesses gaining a larger share of leasing. In Q3 CY2026 (July – September), leasing transaction volume was recorded at 18.7 mn sq ft, registering a 5% year-on-year (YoY) growth over same period last year and a 3% increase over Q2 CY2026.
Bengaluru continued to lead the office market with 16.7 mn sq ft of transactions, accounting for 25% of the overall leasing volume across eight markets in 9M CY 2026. Hyderabad emerged as the second-best performing office leasing market with 13.1 mn sq ft in 9M CY 2026.
Hyderabad emerged as the strongest performing market in Q3 CY2026, recording 5.6 mn sq ft of transactions, up 92% YoY and accounting for 30% of national quarterly leasing. Its year-to-date (YTD) transaction volume has already surpassed its full-year 2025 transaction volume. Bengaluru and Mumbai each recorded 2.6 mn sq ft of transactions in Q3 CY 2026.
All India Office Transactions and New Completions – 9M CY2026
| Office Transactions (Mn Sq Ft) | Completions (Mn Sq Ft) | ||||||
| Cities | 9M CY 2025 | 9M CY 2026 | % Change YoY | Cities | 9M CY 2025 | 9M CY2026 | % Change YoY |
| Bengaluru | 22.5 | 16.7 | -26% | Bengaluru | 8.0 | 19.4 | 143% |
| Hyderabad | 8.8 | 13.1 | 50% | NCR | 5.5 | 4.5 | -19% |
| Mumbai | 7.4 | 9.9 | 33% | Hyderabad | 3.0 | 9.7 | 219% |
| NCR | 9.9 | 9.6 | -4% | Ahmedabad | 0.8 | 3.4 | 339% |
| Pune | 7.4 | 8.8 | 18% | Mumbai | 3.8 | 2.5 | -34% |
| Chennai | 7.9 | 5.9 | -26% | Pune | 9.9 | 6.0 | -39% |
| Ahmedabad | 1.2 | 1.3 | 7% | Chennai | 1.5 | 2.9 | 95% |
| Kolkata | 1.6 | 1.5 | -9% | Kolkata | – | 0.3 | – |
New office supply increased sharply during 9M CY2026. Across the eight major cities, 48.6 mn sq ft of office space was completed during 9M CY 2026, 50% higher than the 32.5 mn sq ft recorded in 9M CY2025. Bengaluru and Hyderabad accounted for 19.4 mn sq ft and 9.7 mn sq ft, respectively, during 9M CY2026. The acceleration was particularly pronounced in Q3 CY2026, as new completions reached 21.5 mn sq ft, 74% higher YoY than the 12.4 mn sq ft completed in Q3 CY2025.
While overall leasing remained stable, the composition of demand continued to evolve. Third-party IT services leasing declined 36% YoY in 9M CY2026, with growth in GCCs, flex and India facing occupiers largely offsetting the decline.
Shishir Baijal, International Partner, Chairman & Managing Director, Knight Frank India, said, “India’s office market continues to grow, even as global businesses operate against a more uncertain geopolitical backdrop. While the headline leasing numbers remain stable, the more important shift is in the nature of demand. GCCs are rapidly expanding their footprint, while flex operators and India-facing businesses are also contributing meaningfully to activity. This reflects India’s growing role in global capability building and domestic business expansion. With rents rising across all markets, the fundamentals remain healthy as we enter the final quarter.”
GCCs strengthen their position as a key driver of office demand
GCCs increased their share of India’s office transactions to 41% in 9M CY2026 from 37% in 9M CY2025 and 31% in 2024. GCC occupiers increased their transaction volumes by 10.4% YoY to 27.4 mn sq ft in 9M CY2026 from 24.8 mn sq ft in 9M CY2025. Bengaluru remained the leading GCC destination with 9.8 mn sq ft in 9M CY2026, accounting for 36% of GCC-focussed transactions across the eight markets. GCC transactions in Hyderabad rose nearly 70% YoY to 6.2 mn sq ft in 9M CY2026.
GCC leasing rose 19% YoY in Q3 CY2026 to 6.8 mn sq ft across leading eight markets, with Hyderabad accounting for 42% of the quarterly GCC leasing volume.
Flex operators were the second-largest contributor to office transactions, accounting for 16.1 mn sq ft or 24% of overall leasing in 9M CY2026, rising 14% YoY from 14.1 mn sq ft in the corresponding period last year led by Hyderabad at 3.5 mn sq ft, followed by Bengaluru at 3.3 mn sq ft.
India-facing businesses accounted for 14.3 mn sq ft in 9M CY2026, or 21% of total transactions, gaining 3.5% YoY over 13.8 mn sq ft recorded for the same period last year. Mumbai emerged as the largest market for this segment at 4.6 mn sq ft, followed by NCR at 3.3 mn sq ft, together accounting for more than half of the space taken up by India-facing businesses.
While other categories grew, third-party IT/ITeS services recorded total leasing of 9.0 mn sq ft, accounting for 13% of overall transactions, a decline of 36% YoY from 14.1 mn sq ft in 9M CY2025. The decline was primarily driven by lower activity in Bengaluru, Chennai and NCR, which recorded reductions in third-party IT/ ITeS leasing compared with the previous year. Hyderabad recorded the highest leasing volume in this category, at 2.9 mn sq ft in 9M CY2026.
Segment-Wise Break Up of Office Transactions – 9M CY2026
| City | GCC (mn sq ft) | India Facing (mn sq ft) | Flex (mn sq ft) | Third Party IT/ITeS services (mn sq ft) | ||||
| 9M CY 2026 | 9M CY 2025 | 9M CY 2026 | 9M CY 2025 | 9M CY 2026 | 9M CY 2025 | 9M CY 2026 | 9M CY 2025 | |
| Mumbai | 3.7 | 0.8 | 4.6 | 3.4 | 1.1 | 2.4 | 0.5 | 0.8 |
| NCR | 2.0 | 2.7 | 3.3 | 3.3 | 3.2 | 1.9 | 1.1 | 2.1 |
| Bengaluru | 9.8 | 11.9 | 1.8 | 2.8 | 3.3 | 3.6 | 1.7 | 4.1 |
| Pune | 3.1 | 1.6 | 1.57 | 1.55 | 2.5 | 2.8 | 1.6 | 1.5 |
| Ahmedabad | 0.04 | 0.1 | 0.66 | 0.65 | 0.5 | 0.12 | 0.04 | 0.3 |
| Chennai | 2.5 | 3.9 | 1.3 | 1.0 | 1.6 | 1.4 | 0.5 | 1.5 |
| Hyderabad | 6.2 | 3.7 | 0.53 | 0.58 | 3.5 | 1.4 | 2.9 | 3.1 |
| Kolkata | 0.05 | 0.05 | 0.47 | 0.53 | 0.4 | 0.4 | 0.6 | 0.7 |
| All India | 27.4 | 24.8 | 14.3 | 13.8 | 16.1 | 14.1 | 9.0 | 14.1 |
| Rental growth remains broad based across markets |
Rental growth remained positive across all eight markets in Q3 CY2026, with annual growth ranging from 3% to 13%. Kolkata recorded the strongest YoY growth at 13%, albeit on a lower base, followed by NCR at 12% and Hyderabad at 9%. Mumbai recorded the strongest quarter-on-quarter (QoQ) growth at 4%.
| Market | Average Transacted Rent in Q3 2026 (INR/sqft/month) | YoY Change | QoQ Change |
| Kolkata | 52.0 | 13% | 2% |
| NCR | 106.5 | 12% | 0% |
| Hyderabad | 82.0 | 9% | 3% |
| Bengaluru | 103.6 | 8% | 1% |
| Chennai | 75.1 | 7% | 1% |
| Pune | 83.0 | 6% | 2% |
| Mumbai | 135.8 | 5% | 4% |
| Ahmedabad | 45.5 | 3% | 0% |
Heavier supply nudged vacancy to 14.7% in Q3 2026 from 14.5% a year earlier, reflecting completion timing and location rather than weaker occupier demand. Occupied stock rose 6.8% YoY to 917.7 mn sq ft. Hyderabad’s vacancy fell 150 bps to 11.8%, Mumbai’s compressed 250 bps to 15.2%, while NCR’s rose 200 bps to 14.5% as completions outpaced absorption.
India’s office market enters the final quarter of 2026 with a broader base of occupier demand and sustained leasing activity. The rising contribution of GCCs, flex operators and India-facing businesses points to a more diversified demand profile. With rental growth remaining positive across all eight markets, the office market is positioned to close 2026 on a firm footing.
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