Delhi-NCR sees supply of new offices fall by 15 percent last year, Mumbai records a decline of 37 percent: Colliers

The real estate markets in Delhi-NCR and Mumbai witnessed a decline in new office space supply by 15 percent and 37 percent respectively over the past year, despite strong demand for premium workspaces from domestic and foreign companies, Colliers said.Real estate consultant Colliers India noted that office demand will exceed new supply by 2025 in India’s seven major cities: Bengaluru, Delhi-NCR, Mumbai, Hyderabad, Chennai, Pune and Kolkata. This has resulted in a decrease in vacancy rates.

Technology companies and the BFSI (banking, financial services and insurance) sector are key drivers of office demand in India. Foreign companies looking to set up Global Capability Centers (GCCs) in India are also helping create demand for premium workspace.The latest data from Colliers India shows that new office space supply in Delhi-NCR fell from 8.7 million sq ft in the calendar year 2024 to 7.4 million sq ft last year.

Mumbai saw a sharper decline of 37 percent in new supply to 5.2 million sq ft in 2025, compared to 8.3 million sq ft in the previous year.

In Hyderabad, the fresh supply fell by 21 percent from 13.7 million square meters to 10.8 million square meters.

New supply in Calcutta fell by 80 percent from 0.5 million square meters to 0.1 million square meters. However, fresh supply improved in Chennai, Bengaluru and Pune markets.

Bengaluru saw a 15 percent increase in fresh produce offerings from 15.2 million square feet to 17.5 million square feet.

In Chennai, new supply has more than doubled from 2.1 million square meters to 4.5 million square meters.

Pune also witnessed a more than two-fold jump in new office space supply to 11 million sq ft in the last year, compared to 5.3 million sq ft in the previous year.

Overall, these seven largest markets saw a 5 percent increase in new office supply last year to 56.5 million square feet, compared to 53.8 million square feet in the previous year.

Office space leasing or absorption grew by 6 percent to 71.5 million square meters in these seven cities last year, compared to 67.2 million square meters in 2024.

“As demand exceeded supply in recent times, overall vacancy levels fell by 49 basis points, while average rents in major cities rose by as much as 15 percent year-on-year (year-on-year),” Colliers India said.

Real estate companies such as DLF Ltd, Prestige Estates, K Raheja Group, Embassy Group, Sattva Group and RMZ group are leading players in the office segment.

There are four office asset-backed real estate investment trusts (REITs) in India. These are Sattva Group and Blackstone-backed Knowledge Realty Trust, K Raheja group-backed Mindspace Business Parks REIT, Brookfield India Real Estate Trust and Embassy Office Parks REIT.

Recently, Bengaluru-based Bagmane Group, sponsored by Bagmane Prime Office REIT, filed a concept paper with market regulator SEBI to launch its Initial Public Offer (IPO) to raise up to Rs 4,000 crore.

REITs are investment vehicles that own or operate income-producing real estate, allowing investors to earn a portion of the income generated without purchasing the properties outright. PTI