Office leasing in 6 metro cities surges 16% with 15.8 mn sqft, topped by Mumbai & Bengaluru

As per the report released by property consultancy Colliers, with 15.8 million square feet the office leasing in India grew by 16% year-on-year across the top-6 markets during the April-June period of 2024. The commercial market is currently driven by Mumbai and Bengaluru.

The six markets surveyed were, Bengaluru, Chennai, Delhi-NCR, Hyderabad, Mumbai and Pune. As per the report, Bengaluru and Mumbai led demand during the second quarter of the 2024 calendar, collectively accounting for 52% of the overall leasing activity during the period. 

Technology, engineering, and manufacturing sectors collectively accounted for 45% of the quarterly demand.

The Managing Director, Office services, India, Colliers, Arpit Mehrotra, mentioned, “A strong H1 performance has set the tone for office space demand to comfortably surpass 50 million square feet for the third consecutive time in 2024.”

During the first half of 2024,the total leasing in the commercial market stood at 29.4 million square feet, marked by 19% surge in the same period.

The report explained that, fresh supply across the top-6 markets grew by 6% year-on-year to 13.2 million square feet during the second quarter of 2024. In this, Mumbai led the trend with a 30% share, followed by Hyderabad at 27%.

The report also emphasized that due to the successful completion of several notable projects in Mumbai, the new supply in Q2 2024 reached a total of 4.0 million square feet. This represents the highest quarterly increase in supply over the past 3-4 years.

The report also added that office vacancy levels remained at around 17% due to high demand surpassing supply during the period analyzed. Additionally, while rentals saw an annual increase, they stayed relatively consistent on a month-to-month basis.

A senior director and head of research at Colliers India,Vimal Nadar said, “Flex operators have already leased about 4.4 million square feet of space in H1 2024, underscoring the occupiers’ continued preference for flex spaces.”