New Delhi, March 7 The net office absorption in top seven cities reached nearly 50 million square feet in 2024, a six-year high and marking a substantial 29 per cent year-on-year increase from 38.64 million sq ft in 2023, a report said on Friday.
The seven cities are Bengaluru, Chennai, Hyderabad, Mumbai Metropolitan Region (MMR), Pune, Delhi-NCR and Kolkata.
Southern markets, particularly Bengaluru and Hyderabad continue to dominate the net office absorption landscape, with Bengaluru leading at 14.9 million sq ft (34 per cent YoY growth), followed by Hyderabad at 7.5 million sq. ft. (7 per cent YoY growth), collectively accounting for 45 per cent of total absorption.
Chennai witnessed a YoY growth of 31 per cent to reach 5 million sq. ft. net office absorption in 2024, according to the report.
NCR showcased exceptional growth with 61 per cent increase – reaching 9.5 million sq ft in 2024, primarily driven by robust demand from global capability centres (GCCs) and the technology sector.
“The market fundamentals strengthened considerably in 2024, with average office vacancies dropping to 16.5 per cent from 17.8 per cent in 2023, despite the substantial new supply addition of over 48.1 million sq ft,” said Peush Jain, MD-Commercial Leasing and Advisory, Anarock Group.
The new office supply totalled 48.1 million sq ft, marking a marginal 1 per cent increase from 2023.
Southern markets maintained their commanding position, collectively contributing 58 per cent of the total new office supply in 2024, although this represents a slight moderation from their 2023 share of 62 per cent.
Hyderabad and Bengaluru, despite each of them witnessing a 4 per cent year-on-year decline, remained the largest contributors with 12.9 million sq. ft. and 12.5 million sq. ft., respectively, said the report.
The western region, particularly Mumbai Metropolitan Region (MMR), emerged as the standout performer with an impressive 89 per cent growth, with 9.3 million sq ft of new office supply in 2024.
The Indian office market has witnessed notable sectoral realignment in transaction patterns through 2024, reflecting broader economic and industry dynamics.
The report stated that the Indian office market is poised to experience positive growth in 2025, driven by multiple favourable factors shaping the commercial real estate landscape. India’s position as a preferred destination for GCCs continues to be a primary catalyst for office space absorption.
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