Mumbai’s office market witnessed strong momentum in the first half of 2026, with gross office leasing activity rising 33% year-on-year to 7.3 million sq ft, according to a report by Knight Frank India. The city recorded one of its highest half-yearly leasing volumes, driven by large institutional deals, rising demand from global capability centres (GCCs), BFSI companies and third-party IT and IT-enabled services firms.
Despite the rise in leasing activity, new office completions declined by 30% during H1 2026 to 1.6 million sq ft. Mumbai’s total office stock stood at 173.8 million sq ft, registering a 3% annual growth.
The report highlighted that stronger demand, coupled with limited new supply, helped reduce vacancy levels. Office vacancy in Mumbai fell by 205 basis points year-on-year to 15.6% during the period. Average transacted rentals also witnessed a marginal increase of 0.5% year-on-year, reaching Rs 130 per sq ft per month, compared with ₹125 per sq ft per month in 2025.
GCCs emerged as the biggest demand driver, accounting for 46% of Mumbai’s total office leasing in H1 2026, a significant increase from 11% during the same period last year. India-focused occupiers contributed 45% of the total transactions, while flexible workspace operators accounted for 6% and third-party IT service providers contributed 4%.
Among Mumbai’s key office districts, SBD Central recorded the highest share of leasing activity at 46%, largely supported by transactions in Powai. SBD West accounted for 20% of leasing, while the peripheral business district contributed 14%. Together, these three locations accounted for nearly 80% of the city’s total office transactions.
BKC and off-BKC areas contributed 16% of leasing activity, followed by Central Mumbai at 9% and CBD and off-CBD locations at 3%.
In terms of rental values, BKC and off-BKC remained the most expensive office markets, with rents ranging between Rs 237 and Rs 446 per sq ft per month. CBD and off-CBD recorded rentals of Rs 200-279 per sq ft per month, while Central Mumbai saw rates between Rs 195 and Rs 279 per sq ft per month. SBD Central recorded rentals in the range of Rs 130-232 per sq ft per month, while SBD West witnessed rents between Rs 102 and Rs 195 per sq ft per month.
Source: ET Realty
