India's office market steadies as GCCs and flexible spaces drive demand shift

Leasing activity in eight key Indian cities totaled 66.7 million sq ft during the first nine months of 2026, essentially unchanged from the same period a year earlier. The market’s stability masks a notable shift in occupier mix: global capability centers (GCCs) are rapidly expanding, with Hyderabad’s GCC leasing jumping almost 70% year-on-year to 6.2 million sq ft and Bengaluru representing 36% of all GCC-focused deals.

Flexible workspace providers also strengthened their position, adding 14% to reach 16.1 million sq ft and accounting for 24% of total transactions. Meanwhile, leasing by third-party IT and ITeS firms fell 36% to 9 million sq ft, reflecting reduced activity in Bengaluru, Chennai and the National Capital Region, though Hyderabad recorded the highest ITeS leasing at 2.9 million sq ft. Supply grew sharply, with new completions up 50% year-on-year to 48.6 million sq ft, while rents rose across all eight markets and the vacancy rate ticked up to 14.7% in the September quarter.