India’s commercial office market recorded net absorption of 42.9 million sq. ft. during the first nine months of 2026, marking a 2% increase from 42 million sq. ft. in the same period last year, according to Anarock Research & Advisory. Coworking operators and the banking, financial services and insurance (BFSI) sector together accounted for 47% of leasing demand, up from 41% a year earlier.
New office completions across the country’s seven major cities rose 5% year-on-year to 41.1 million sq. ft. Hyderabad and Bengaluru led market growth, registering increases in both absorption and fresh supply.
Mumbai market maintains steady performance
The Mumbai Metropolitan Region (MMR) recorded absorption of 6.65 million sq. ft., compared with 6.6 million sq. ft. in the corresponding period of 2025. New completions increased 21% to 4.1 million sq. ft. Average office rentals reached Rs 156 per sq. ft. monthly, the highest among the seven markets, rising 8% annually. Vacancy declined from 14.9% to 13.3%.
Bengaluru remained the largest market for net absorption at 11.92 million sq. ft., up 20%, while Hyderabad recorded a 54% increase to 8.8 million sq. ft. Hyderabad also registered the strongest rental growth, with average rates climbing 12% to Rs 77 per sq. ft. per month.
Mixed trends across other cities
Delhi-NCR’s absorption fell 11% to 7.32 million sq. ft., while Pune recorded a 36% decline to 3.95 million sq. ft. Chennai saw absorption decrease 21% to 3.56 million sq. ft. Kolkata registered 0.7 million sq. ft., down 18%.
Peush Jain, Managing Director – Commercial Leasing & Advisory, ANAROCK Group, says, “Coworking has overtaken IT/ITeS office space demand – at 26%, it now commands the highest overall leasing share in 9M 2026, followed closely by IT/ITeS with a 25% share and BFSI with 21%.”
National office vacancy improved to 15.15% from 16.2% a year earlier. Jain added, ‘The combination of lower vacancy and higher rentals points to improving market conditions at the national level. However, the differentiated performance of individual markets – strong absorption growth in Hyderabad and Bengaluru and softer activity in NCR, Pune, and Chennai – is notable,” Jain added.
Source: The Free Press Journal
