Hyderabad Office Market Grows in Q1 2025 with 1.9 Mn Sq Ft Take-Up

Office leasing activity in Hyderabad reached 1.9 million sq. ft. in the first quarter of 2025, as per the latest data from CBRE South Asia Pvt. Ltd. The firm’s India Office Figures Q1 2025 report highlights that life sciences, technology, and FMCG and retail sectors were the top contributors to the city’s leasing demand from January to March 2025.

Life sciences led Hyderabad’s leasing at 23 per cent, followed by technology at 17 per cent and FMCG and retail at 13 per cent. The city’s leasing was dominated by small to mid-sized transactions, with a clear preference for non-SEZ spaces, which comprised nearly 80 per cent of the total office leasing.

On a pan-India basis, gross absorption in Q1 2025 stood at 18.0 million sq. ft., reflecting a year-over-year increase of 5 per cent. Bengaluru, Delhi-NCR, and Mumbai accounted for close to 64 per cent of the total leasing.

- Bengaluru posted 4.8 million sq. ft. of leasing, led by American tech firms. Technology made up 33 per cent, engineering and manufacturing 24 per cent, and BFSI 18 per cent.

- Delhi-NCR saw 3.8 million sq. ft., largely from BFSI global capability centres (GCCs), with technology at 22 per cent and consulting at 15 per cent.

- Mumbai reported 2.9 million sq. ft., driven by BFSI sector activity, which contributed 53 per cent of the demand.

Other cities contributed as follows:

- Chennai: 2.6 million sq. ft.

- Pune: 1.3 million sq. ft.

- Kolkata: 0.4 million sq. ft.

- Ahmedabad: 0.3 million sq. ft.

- Kochi: 0.05 million sq. ft.

BFSI firms recorded over 100 per cent year-on-year growth, representing 26 per cent of overall leasing volume. American banks accounted for 48 per cent of this, with domestic banks contributing 31 per cent. GCCs formed 57 per cent of BFSI leasing. Of that, 70 per cent was led by U.S.-based GCCs.

Overall, GCC leasing rose to 8.0 million sq. ft. in Q1 2025, marking a 66 per cent increase compared to Q1 2024. Bengaluru led with a 40 per cent share, followed by Delhi at 24 per cent, Chennai at 14 per cent, Hyderabad at 10 per cent, Mumbai at 6 per cent, and Pune at 5 per cent.

Green-certified buildings accounted for 81 per cent of total leasing, while 88 per cent of new supply, totaling 8.6 million sq. ft., carried green certification. Bengaluru led both green-certified supply (38 per cent) and leasing (29 per cent). Delhi-NCR followed with 29 per cent of supply and 24 per cent of leasing.

Pune contributed 33 per cent to green supply and 4 per cent to green leasing. Mumbai stood at 17 per cent, while Hyderabad and Chennai recorded 11 per cent and 10 per cent, respectively.

Aside from BFSI, the breakdown for leasing across sectors stood as:

- Technology: 24 per cent

- Flexible space: 12 per cent

- Engineering & manufacturing: 11 per cent

- Research, consulting & analytics: 8 per cent

- Life sciences: 5 per cent

Global companies contributed 62 per cent to total leasing. American firms led with a 45 per cent share, while EMEA stood at 12 per cent and APAC at 5 per cent. Domestic companies made up the remaining 38 per cent.

Anshuman Magazine, Chairman & CEO – India, SE Asia, Middle East & Africa, CBRE, noted that the Indian office market continues on a growth trajectory, with sustained leasing led by domestic and global firms. He pointed to rising demand for sustainable and experience-focused workspaces as a key shift shaping the future of the sector.

Ram Chandnani, Managing Director, Advisory & Transaction Services, CBRE India, emphasized India’s emergence as a leading GCC hub, with growth not only in metro cities but increasingly in tier-II locations. He said sectors like semiconductors, aerospace, and life sciences are expected to drive future demand.

CBRE forecasts a continued upward trend in leasing across India, with the following highlights:

- Technology demand driven by AI, ML, data analytics, and cloud computing

- BFSI and E&M sectors expected to sustain high leasing volumes

- Rising demand in semiconductors, automobiles, and life sciences

- Major completions focused in Bengaluru, Hyderabad, and Delhi-NCR

- Shift towards integrated tech parks and green-certified buildings

- Hybrid and reconfigurable workspaces gaining popularity

- Institutional investments in under-construction, high-grade assets expected to rise

- Demand-supply equilibrium likely to compress vacancies and influence rental growth