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Office space absorption across India's six major commercial hubs is expected to reach a new record by the end of the current fiscal, supported by steady demand from domestic and international companies. ICRA has projected net absorption to rise to around 69-70 million sq ft, slightly higher than last fiscal's 66 million sq ft. Vacancy levels are also likely to improve, falling to about 12.5-13 per cent. The first half of FY26 has already seen 36 million sq ft of space absorbed, driven largely by Global Capability Centres, flexible workspace operators and the BFSI sector.
ICRA has projected that office space absorption across India's six leading commercial markets will see a marginal rise this fiscal, supported by continued requirements from both domestic and overseas enterprises. The agency expects net absorption to reach around 69-70 million sq ft, which would mark the highest level recorded so far. Net absorption refers to the difference between office space physically occupied and the area vacated over a specific period. Advertisement
The previous fiscal had closed with 66 million sq ft of net absorption, reflecting the ongoing recovery in the commercial office segment. In the first half of FY26, net absorption has already reached 36 million sq ft, indicating stable demand momentum across major cities.
ICRA noted that Bengaluru, Chennai, Delhi-NCR, Hyderabad, Mumbai Metropolitan Region and Pune are expected to drive this growth. It also assessed that vacancy levels are likely to ease to about 12.5-13 per cent by the end of the fiscal, continuing the gradual improvement seen over the past few years.
According to the agency, the rise in overall demand is mainly due to increased interest from Global Capability Centres, which have expanded their presence in India over the last several years. Flexible workspace operators and companies in the BFSI sector have also contributed meaningfully to the absorption trend. The data used by ICRA is sourced from PropEquity along with its internal research.
Source PTI
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