Mumbai, August 2025 – India’s tech office market is witnessing a two-horse race, with Bengaluru and Hyderabad collectively securing 50% of all tech-sector leasing (5.3 million sq ft) among top Indian cities in H1 2025. The surge is driven by expanding Global Capability Centers (GCCs) and domestic tech giants betting on hybrid work models, signaling renewed confidence in office-based operations alongside flexible remote arrangements.
According to recent industry reports, Bengaluru alone accounted for 3.1 million sq ft of tech-sector leasing, consolidating its position as the country’s premier IT hub. Hyderabad followed closely with 2.2 million sq ft, benefiting from government-backed initiatives such as the “IT Hubs Expansion Scheme” and robust infrastructure development. Companies across fintech, SaaS, and digital services are increasingly opting for larger office footprints to accommodate hybrid teams, innovation labs, and collaborative workspaces in India.
Experts note that this surge reflects a broader trend in tech-driven urban migration, where talent density and quality of life play a crucial role in location decisions. GCCs, in particular, are expanding operations in these cities to leverage skilled talent pools, cost efficiencies, and favorable real estate conditions. The adoption of hybrid work models has also encouraged companies to rethink office layouts—shifting from traditional cubicles to flexible, amenity-rich environments that foster collaboration and innovation.
Furthermore, rental growth in these tech clusters remains resilient, with prime office spaces witnessing an average rent increase of 8–10% YoY. Secondary markets are also catching up, as smaller tech firms and start-ups seek proximity to talent hubs without bearing premium costs.
Industry analysts suggest that the momentum could continue through 2025, driven by digital transformation mandates, expansion of global delivery centers, and increasing start-up activity. With Bengaluru and Hyderabad capturing half of the tech leasing market, other cities such as Pune, Gurugram, and Chennai are vying for the remaining share by offering specialised clusters, tax incentives, and superior connectivity.
As India’s IT sector grows at a robust pace, the office market landscape is evolving into a strategically concentrated yet competitive ecosystem, where cities compete not just on cost but on talent, infrastructure, and innovation-driven amenities.
🏙️ City-Wise Leasing Breakdown (H1 2025)
| City | Tech Leasing (sq ft) | Market Share | Key Drivers |
|---|---|---|---|
| Bengaluru | 3.0M | 28% | GCC expansions (Apple, NVIDIA), AI startups |
| Hyderabad | 2.3M | 21% | Microsoft, Amazon, Indian SaaS unicorns |
| Pune | 1.8M | 17% | Engineering R&D centers |
| Delhi-NCR | 1.5M | 14% | FinTech, edtech scaling |
| Chennai | 1.2M | 11% | Auto-tech, manufacturing GCCs |
| Mumbai | 0.9M | 8% | BFSI tech hubs |
| Kolkata | 0.3M | 3% | Cost-optimized back offices |
💡 What’s Fueling the Demand?
✅ GCC Growth: India now hosts 2,100+ GCCs (200+ added in 2025)
✅ Hybrid Work Shift: 60% of tech firms adopt 3-day office mandates
✅ AI Talent Wars: Bengaluru’s 50K+ AI engineers force office expansions
🏢 Top Deals of H1 2025
1️⃣ NVIDIA – Leased 500K sq ft in Bengaluru (largest AI R&D hub outside US)
2️⃣ Microsoft – Expanded Hyderabad campus by 300K sq ft (Azure AI teams)
3️⃣ Zoho – 250K sq ft in Chennai for hardware R&D
📊 Market Trends
🔹 Rent Growth: Bengaluru (+14% YoY), Hyderabad (+12%)
🔹 New Supply: 18M sq ft under construction (55% in Bengaluru-Hyderabad)
🔹 Design Shift: 70% leases now demand AI-ready campuses (high-power cooling, GPU clusters)
🌐 Global Context
- India’s tech leasing 2x faster than APAC average
- Cost Advantage: Bengaluru rents still 1/3rd of Singapore, 1/5th of SF
⚠️ Challenges Ahead
- Power Infrastructure: AI data centers strain Bengaluru’s grid
- Talent Concentration: 82% of leasing in 5 cities risks regional imbalance
📢 The Big Picture: With GCCs projected to employ 3M+ by 2027, this leasing frenzy is just the beginning.
Which city should be India’s next tech hub?
#RealEstate #TechHubs #Bengaluru #Hyderabad #GCC #OfficeSpace