India Office Leasing Rises 6% to 35.7 Million Sq Ft in H1 2026; Bengaluru Leads Demand: Colliers

India’s commercial real estate market continued to demonstrate resilience during the first half of 2026, with gross office leasing increasing 6% year-on-year to 35.7 million square feet across the country’s top seven cities, according to Colliers India.

The report highlights sustained occupier confidence despite a relatively softer second quarter. Grade A office space absorption reached 17.4 million square feet during Q2 2026, while the first-half performance was supported by a strong opening quarter, marking the ninth consecutive quarter with more than 15 million square feet of Grade A leasing.

Bengaluru retained its position as India’s leading office market, recording 10.5 million square feet of leasing during H1 2026, accounting for nearly 29% of the country’s total demand. Hyderabad emerged as another strong performer with 7.2 million square feet of leasing, registering an impressive 47% year-on-year increase as global capability centres and technology firms continued to expand their presence.

The report also noted growing demand for flexible workspaces. Flex space leasing surged 32% year-on-year to 8.6 million square feet during the first six months of 2026, reflecting the increasing preference of occupiers for scalable and agile workplace solutions. Conventional office leasing remained stable at 27.1 million square feet, driven primarily by technology companies and the banking, financial services and insurance sector.

On the supply side, developers added 22.5 million square feet of new Grade A office space during H1 2026. Although this represented a 9% decline compared to the same period last year, Bengaluru continued to lead new completions, followed by Delhi NCR and Mumbai.

According to Colliers, vacancy levels remained stable at around 15% across major office markets, while rentals increased by up to 5% in select micro-markets due to sustained occupier demand.

The report indicates that India’s office market remains on a healthy growth trajectory, supported by strong demand from technology, BFSI, flexible workspace operators and global capability centres. With improving business confidence and continued corporate expansion, the commercial real estate sector is expected to maintain steady leasing momentum through the remainder of 2026.