Office Demand in Top 7 Cities Dips 1%, New Supply Down 36% in Jan–Mar: Vestian

Leasing of office spaces across seven major cities fell by 1 per cent in January-March from the preceding quarter, while the new supply of workspaces declined 36 per cent as construction activities were affected due to the West Asia conflict, according to Vestian.

On Monday, US-based real estate consultant Vestian released India office market report, stating that the demand for office spaces remained resilient during the first quarter of 2026.

According to the data, office space leasing across seven major cities stood at 21.53 million sq ft in January-March, down 1 per cent from the preceding quarter.

New supply stood at 9.70 million sq ft, a 36 per cent decline from the October-December quarter in 2025.

The consultant attributed the fall in fresh supply to delay in completion of commercial projects because of problem in availability of key construction materials.

The seven cities are Mumbai, Delhi-NCR, Bengaluru, Pune, Chennai, Hyderabad and Kolkata.

On an annual basis, office space leasing grew by 20 per cent while new supply increased 2 per cent.

Shrinivas Rao, CEO of Vestian, said, “India’s office market exhibited resilience in the first quarter of 2026, despite global geopolitical challenges." The sustained leasing, particularly driven by GCCs (global capability centres), highlights India’s growing prominence as a strategic hub for global corporations, he added.

"While supply chain constraints led to a temporary slowdown in new completions, robust absorption has tightened vacancies and driven rental appreciation," Rao said.

Looking ahead, he said the rapid GCC expansion, rising demand for sustainable office spaces, and India’s stable macroeconomic environment are expected to drive the next wave of growth in the office sector.

Vestian pointed out that the new office supply plunged 95 per cent to 0.3 million square feet in January-March compared to 6 million square feet in the preceding quarter.