Office gross leasing absorption across India’s six major cities recorded a new all-time high of 62.3 million square foot (msf) in 2023, registering a 12% growth over the previous year, according to a report by real estate advisory firm Savills India. The six major cities cited in the report are Bangalore, Delhi-NCR, Mumbai, Hyderabad, Chennai and Pune. Bangalore, Delhi-NCR and Mumbai are the top three performing cities and contributed to nearly 60% of the gross leasing activity in 2023, the report said.
Mumbai’s real estate market saw record leasing activity at 10.1 msf owing to large transactions by tech and consulting occupiers. The gross absorption increased by 51% compared to 2022. On the other hand, Chennai and Mumbai saw an all-time high gross leasing activity in 2023, according to the report. According to the report, Bangalore continued to dominate the leasing activity and topped the charts at 15.6 msf. However, the city’s gross absorption was 10% lower YoY. This is due to a 15% YoY decline in leasing activity by the tech occupiers.
Delhi-NCR saw similar absorption levels as 2022 at 11.3 msf, followed by Hyderabad and Chennai, who reported a notable annual increase of 34% and 32%, respectively, in the gross leasing activity at 8.6 msf and 9.6 msf. Meanwhile, Pune reported 7.1 msf of office space leasing, which is around 11% higher than the 6.4 msf it reported in 2022, the report said.
| Cities | Gross absorption in 2023 (in msf)
|
Gross absorption in 2022 (in msf) | YoY change |
| Bangalore | 15.6 | 17.3 | -10% |
| Chennai | 9.6 | 7.3 | 32% |
| Delhi-NCR | 11.3 | 11.3 | 0% |
| Hyderabad | 8.6 | 6.4 | 34% |
| Mumbai | 10.1 | 6.7 | 51% |
| Pune | 7.1 | 6.4 | 11% |
| Total | 62.3 | 55.3 | 12% |
New supply in 2023 was at similar levels as the year before at 53.3 msf. Of this, approximately 61% of the new supply is noted in Bangalore and Hyderabad.
| Cities | New supply in 2023 (in msf) | New supply in 2022 (in msf) | YoY Change |
| Bangalore | 17.1 | 12.7 | 35% |
| Chennai | 6.8 | 5.0 | 37% |
| Delhi-NCR | 5.5 | 6.5 | -15% |
| Hyderabad | 15.5 | 16.5 | -6% |
| Mumbai | 3.1 | 5.4 | -43% |
| Pune | 5.3 | 7.3 | -27% |
| Total | 53.3 | 53.4 | 0% |
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Dhwani is a content management expert with over five years of professional experience. She has authored articles spanning diverse domains, including real estate, finance, business, health, taxation, education and more. Holding a Bachelor’s degree in Journalism and Mass Communication, Dhwani’s interests encompass reading and travelling. She is dedicated to staying updated on the latest real estate advancements in India.
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