Stylework Team
India’s commercial property segment is seeing a shift in trends, with big-ticket office spaces on the rise, especially in Bengaluru.
Famously referred to as the Silicon Valley of India, the is has carved a niche image for itself in the sphere concerning corporate expansions and commercial leasing, especially for the multinational corporate and IT majors as well as starters.
According to Knight Frank report Bengaluru in H1 2024, the large office space makes up 53% of total commercial transaction volumes of the city with transactions of 4.5 million sq ft. Source
Such a high demand is due to factors such as the establishment of Global Capability Centres (GCCs), and the business model that is open and created for the IT and tech-related sectors.
Now we will explore why Bengaluru is leading this growth and what is going on in the overall industry throughout India.
Growth of Large Office Spaces Across India
From the Knight Frank Report, one can get the figures showing the phenomenal YoY growth of transactions of large office spaces of more than 100000 sq .ft.
In H1 2024 the market rose by 54% from 10, 18m sq ft in H1 2023 to 15, 69m sq ft in H1 2024. This trend indicates that corporate expansion continues to grow throughout India with Bengaluru emerging as the market leader, followed by Hyderabad and Mumbai.
| City | Large Office Space Leased (H1 2024) |
| Bengaluru | 4.5 million sq ft |
| Hyderabad | 3.08 million sq ft |
| Mumbai | 2.66 million sq ft |
| NCR (Delhi) | 1.87 million sq ft |
| Pune | 1.82 million sq ft |
As can be seen in the table, Bengaluru has surpassed other cities in terms of the demands for even large office formats, thus putting the city at the forefront of corporal investments.
Also Read: Why Flexible Workspaces Trending in India
Why Bengaluru?
Bengaluru’s ability to attract a high volume of commercial real estate investments can be attributed to several key factors:
Tech Hub of India: Since some of the biggest IT companies and start-ups by successful talents from the engineering world in India, Bengaluru shines as one of the leading technology cities in the world now.
Flexible Workspaces: When it comes to the post-pandemic reality, flexibility is incredibly important. Management is continually inclining towards flexible office spaces and models that can be easily managed, complex, and economical.
Corporate Expansion: Large global companies (LPCs) remember Bengaluru as a potential market to expand. In large-scale corporate offices, the city is well equipped with infrastructure, talent, and connection levels which can help companies to reveal their maximum potential.
Supportive Real Estate Market: Office space leasing in Bengaluru has varied options such as multi-office business complexes, and built-up spaces depending on the requirements of the corporations. This availability has an added influence on the increased need for bigger office spaces.
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National Trends: The Bigger Picture
As for Bengaluru, it has surpassed other cities in terms of the need for large office spaces, although other cities did show a similar tendency. For example, Hyderabad took 3.08 million sq ft and Mumbai was close behind with 2.66 million sq ft during H1 2024.
Whenever there was a broad perspective of formal commercialization of office space leasing, it showed how it comprised 45% of all the total commercial deals actualized in eight cities of Bengaluru, Hyderabad, Mumbai, NCR, Pune, Chennai, Kolkata, and Ahmedabad.
| Segment | Total Space Leased (H1 2024) | YoY Growth |
| Large Office Spaces (>100,000 sq ft) | 15.69 million sq ft | 54% |
| Mid-Segment (50,000-100,000 sq ft) | 7.28 million sq ft | 70% |
| Small Office Spaces (<50,000 sq ft) | 11.7 million sq ft | 0.08% |
Future Outlook for Large Office Spaces
The growth in the requirement for obtaining extensive commercial places for office usage is likely to remain higher. Knight Frank India’s Shishir Baijal pointed out that “Bengaluru has emerged as the most preferred for large occupiers seeking opportunities to grow their Indian operations.”
The management expects the city to continue to dominate office space leasing in the country as organizations expand their use of flexible workspaces and Global Capability Centres.
An inherent feature in the size of new and proposed offices is the indicating factor for long-term tenancies, where businesses are making long-term commitments to spaces that would accommodate large and complex operations and technological incubation centers.
This is even more so, especially for other areas like IT, Fintech and Biotechnology where big infrastructures are required to accommodate many people and facilities for the development of products.
Also Read: Why Are Companies Inching Towards Flexible Workspaces?
Final Thoughts
In conclusion, the fact that Bengaluru occupies a leading position in terms of demand for large offices proves that the city is one of the most important players in the Indian commercial real estate market.
Given the burgeoning numbers of technology start-ups, a ready talent pool, and more importantly a modern infrastructure, it is not only holding its place among the front runners but leading the Indian city’s growth in the process.
It is evident that the city will continue to strengthen itself in the market for office leasing, and write its success story in the global corporate growth story.