India’s commercial real estate story has entered a new phase.
According to Knight Frank India, occupied office space across the country’s eight leading office markets reached 901.1 million sq. ft. as of June 30, 2026, crossing the landmark 900-million-sq.-ft. threshold for the first time. This represents a 6% year-on-year increase from 847 million sq. ft. in H1 2025, highlighting continued occupier confidence and expansion by businesses.
The milestone is particularly significant because India’s total office stock has already crossed 1.05 billion sq. ft. The scale of occupied space demonstrates how deeply commercial real estate has become embedded in India’s economic growth story.
8
From Real Estate Growth to Corporate Infrastructure
India’s office market is no longer driven simply by conventional IT companies.
The market is increasingly being shaped by Global Capability Centres (GCCs), financial services, technology companies, multinational corporations, flexible workspace operators and expanding domestic enterprises.
Knight Frank’s research indicates that GCC expansion and the growing footprint of domestic enterprises remain important drivers of office demand, while companies increasingly prefer established locations that provide access to talent, infrastructure and scale.
This represents an important structural change.
India is increasingly being selected not merely as a low-cost outsourcing destination, but as a location for technology, research, engineering, analytics, financial services and global business operations.
Knight Frank had already identified this structural shift following the record performance of India’s office market in 2025, when annual leasing crossed 86 million sq. ft., while total office stock crossed the one-billion-sq.-ft. milestone.
48 Million Sq. Ft. Leased in H1 2026
The strength of the market is also visible in fresh leasing activity.
During January–June 2026, India’s eight major office markets recorded approximately 48 million sq. ft. of office transactions. While this was slightly below the exceptional level of the previous year, the volume remained close to record territory.
More importantly, the composition of demand is changing.
Large office transactions—spaces of 100,000 sq. ft. or more—accounted for 28.2 million sq. ft., or about 59% of total H1 leasing.
That tells us something important about the market:
Large occupiers are still committing substantial capital and long-term office requirements despite global economic uncertainty.
The preference is increasingly toward institutional-quality, Grade-A and future-ready office buildings.
Hyderabad: One of India’s Fastest-Growing Commercial Markets
For Hyderabad, the story is even more compelling.
Knight Frank data shows that Hyderabad recorded 7.5 million sq. ft. of office transactions in H1 2026, representing a remarkable 29% year-on-year increase. It was Hyderabad’s strongest-ever first-half leasing performance and its second-highest half-year transaction volume on record.
This is not merely an increase in office supply.
It is evidence of sustained occupier demand.
Hyderabad’s total office stock reached approximately 129.1 million sq. ft., up 5% year-on-year. At the same time, vacancy declined by 296 basis points to 11.5%, even as approximately 3 million sq. ft. of new office space was completed.
That combination—new supply + stronger absorption + declining vacancy—is one of the strongest indicators of a healthy commercial real-estate ecosystem.
GCCs Are Reshaping Hyderabad’s Office Market
One of the biggest forces behind Hyderabad’s commercial growth is the expansion of Global Capability Centres.
GCCs accounted for approximately 45% of Hyderabad’s office leasing in H1 2026, compared with 40% during H1 2025. Approximately 3.4 million sq. ft. was leased by GCC occupiers during the period.
The demand is also becoming more diversified.
Within Hyderabad’s GCC leasing:
- Other services — 32%
- BFSI — 28%
- IT/ITeS — 23%
- Manufacturing — 18%
This diversification is particularly important because it reduces the city’s dependence on a single industry.
And nationally, the GCC story is becoming even broader.
Foreign banking, financial services and insurance companies leased 7.32 million sq. ft. for GCC operations across India’s eight major markets in H1 2026, representing a 70% year-on-year increase.
The message is clear:
India’s next phase of commercial real-estate growth is increasingly being powered by high-value global operations, not simply traditional IT back offices.
Grade-A Offices Are Winning
Hyderabad’s leasing numbers reveal another significant trend.
Approximately 95% of Hyderabad’s H1 2026 leasing transactions were in Grade-A properties.
That is a powerful signal for developers and investors.
Corporates are increasingly looking for:
- Premium office infrastructure
- Modern workplace environments
- Better connectivity
- High-quality building specifications
- Sustainability and technology
- Large floor plates
- Reliable infrastructure
- Scalable expansion opportunities
The commercial real-estate market is therefore moving from simply providing office space to providing institutional-quality business infrastructure.
Hyderabad’s Large-Format Office Demand Is Particularly Strong
Hyderabad also stands out when analysing large office transactions.
Office transactions involving spaces larger than 100,000 sq. ft. reached approximately 4.9 million sq. ft. in Hyderabad during H1 2026.
These large transactions represented around 65% of Hyderabad’s total leasing activity, up from 51% a year earlier.
This makes Hyderabad one of India’s strongest markets for large-format occupiers.
The trend is important for the wider real-estate ecosystem because large corporate occupiers create demand not only for office buildings, but also for:
housing → retail → hospitality → education → healthcare → transportation → entertainment → urban infrastructure.
Commercial growth therefore has a multiplier effect on surrounding residential and mixed-use markets.
Hyderabad’s Office Geography Is Expanding
The traditional Hyderabad office story was heavily concentrated around established IT corridors.
But the market is now broadening.
Knight Frank’s H1 2026 data shows that the Suburban Business District (SBD) accounted for around 60% of Hyderabad’s leasing activity, with major locations including:
Kondapur, Raidurg, HITEC City and the Financial District.
At the same time, the PBD West market accounted for approximately 36% of leasing, a dramatic increase from just 1% in H1 2025, driven by large transactions in areas including Nanakramguda and the shortage of quality office space in established districts.
This is a crucial development for Hyderabad’s future urban geography.
The city’s commercial growth is progressively moving outward from established business districts into new development corridors.
Office Rents Are Moving Up
Demand is also beginning to translate into rental growth.
Hyderabad’s average transacted office rent increased approximately 7% year-on-year to ₹80 per sq. ft. per month during H1 2026.
The Suburban Business District recorded the strongest annual rental growth at approximately 11%.
Indicative rental ranges during H1 2026 were:
| Hyderabad Business District | Indicative Rent |
|---|---|
| SBD | ₹70–₹145/sq. ft./month |
| PBD West | ₹55–₹97/sq. ft./month |
| CBD & Off-CBD | ₹60–₹85/sq. ft./month |
Rising rents, falling vacancy and strong absorption together suggest that quality commercial space is acquiring greater pricing power.
Flexible Workspaces Are Becoming Mainstream
Another major transformation is the rise of flexible office operators.
In Hyderabad, flexible workspace operators accounted for approximately 27% of total leasing activity in H1 2026, compared with only 9% during the corresponding period of 2025.
Nationally, Knight Frank has also identified flexible and managed offices as an increasingly important component of India’s office ecosystem.
The shift reflects how companies are changing the way they consume real estate.
Instead of committing exclusively to conventional long-term leases, businesses increasingly want:
speed + flexibility + scalability + premium infrastructure.
That is creating an entirely new commercial real-estate segment.
Hyderabad’s 114.3 Million Sq. Ft. Occupied Office Base
The broader occupied-stock numbers reinforce Hyderabad’s position.
As of H1 2026, Hyderabad had approximately 114.3 million sq. ft. of occupied office space, representing an 8% year-on-year increase.
For perspective:
| Market | Occupied Office Stock H1 2026 |
|---|---|
| Bengaluru | 222.4 mn sq. ft. |
| Delhi-NCR | 178.1 mn sq. ft. |
| Mumbai | 146.6 mn sq. ft. |
| Hyderabad | 114.3 mn sq. ft. |
| Pune | 98.8 mn sq. ft. |
Hyderabad is therefore firmly positioned among India’s largest institutional office markets.
What Does This Mean for Hyderabad Real Estate?
The commercial numbers have implications far beyond office buildings.
When thousands of employees and global companies enter a corridor, demand follows across the wider real-estate ecosystem.
1. Residential demand
Corporate expansion creates demand for housing close to employment centres.
2. Retail development
More employees and residents create demand for restaurants, shopping, entertainment and everyday services.
3. Hospitality
Corporate travel and business activity support hotels, serviced apartments and hospitality infrastructure.
4. Infrastructure
Roads, metro connectivity, public transportation and social infrastructure become increasingly important.
5. Land values
As development moves toward new corridors, landowners and developers can benefit from increasing competition for strategically located land.
6. Investment opportunities
Institutional investors increasingly view high-quality commercial assets as long-term income-generating investments.
The Bigger Picture: India’s Commercial Real Estate Is Becoming an Economic Engine
The most important takeaway from Knight Frank’s latest data is not simply that India has crossed 900 million sq. ft. of occupied office space.
It is what the milestone represents.
India’s commercial real-estate market is becoming increasingly:
institutionalised.
corporate-driven.
GCC-led.
technology-enabled.
geographically diversified.
and infrastructure-dependent.
India’s office stock crossed the 1-billion-sq.-ft. threshold in 2025. By June 2026, occupied stock had climbed to 901.1 million sq. ft.
And Hyderabad is emerging as one of the key engines of that growth.
With 7.5 million sq. ft. of H1 leasing, 29% annual growth, 45% GCC share, declining vacancy, rising rents and 114.3 million sq. ft. of occupied office stock, Hyderabad’s commercial real-estate story is increasingly difficult to ignore.
The New Hyderabad Opportunity
The next chapter of Hyderabad’s real-estate growth may not be defined simply by how many residential units are launched.
It may be defined by where jobs, businesses, infrastructure and investment converge.
As commercial hubs expand from established locations such as HITEC City and Raidurg toward Financial District, Nanakramguda and emerging peripheral business corridors, the surrounding real-estate landscape is likely to continue evolving.
The real opportunity, therefore, lies in understanding the next growth corridors before they become the established ones.
India has crossed 900 million sq. ft. of occupied office space.
Hyderabad has crossed 114 million sq. ft.
And the city’s commercial expansion is still underway.