Bengaluru Office Leasing Plummets by 21% as Corporates Delay Decisions Amid Global Uncertainty

Bengaluru Office Leasing Plummets by 21% as Corporates Delay Decisions Amid Global Uncertainty​

Bengaluru Market Experiences Significant Decline in Workspace Leasing​

Bengaluru, identified as India's leading office market, reported a sharp contraction in gross leasing activity for workspaces during the January to June period. Gross leasing in Bengaluru fell by 21 percent, recording 9.37 million sq ft of leased space in the first half of the year (H1). This was down from 11.79 million sq ft recorded in the corresponding period of the previous year.

This downturn reflects cautious corporate sentiment and delayed decision-making among corporations operating globally. JLL, a real estate consultant, highlighted that these figures reflect all lease transactions and confirmed pre-commitments but do not include deals still under discussion or term renewals.

Pan-India Office Leasing Shows Mixed Regional Trends​

The overall gross leasing across seven major office markets in India experienced a 4 percent decline during January to June this year. The total registered leased space stood at 37.90 million sq ft, compared to 39.45 million sq ft recorded in the previous year's equivalent period.

The regional performance was varied. While Bengaluru, Delhi-NCR, and Kolkata all witnessed declines in leasing activities, other cities such as Mumbai, Pune, Chennai, and Hyderabad reported growth in their respective office markets.

Growth Momentum Noted in Southern and Western Metros​

In contrast to the downturn in established hubs like Bengaluru and Delhi-NCR, several key metropolitan areas showed signs of robust growth in office demand. Pune recorded a strong increase of 23 percent, reaching 6.02 million sq ft from 4.88 million sq ft in the prior year.

Mumbai saw an 18 percent surge in leasing activity, registering 5.88 million sq ft up from 4.99 million sq ft. Chennai also registered growth, with gross leasing rising 2 percent to 3.98 million sq ft from 3.89 million sq ft. Hyderabad experienced a considerable rise of 18 percent, reaching 5.38 million sq ft in the period compared to 4.58 million sq ft.

Delhi and Kolkata Suffer Sharp Declines in Leasing Activity​

The two markets experiencing the most significant percentage declines were Delhi-NCR and Kolkata. The leasing activity in Delhi-NCR fell by 21 percent, recording 6.6 million sq ft against 8.37 million sq ft in the preceding period.

Kolkata saw an even steeper drop of 29 percent, with gross leasing falling to 0.67 million sq ft from 0.95 million sq ft in the year-ago period.

GCCs and Co-working Drive Fundamental Transformation in Office Sector​

JLL noted that India's office market demonstrates a high degree of maturity as global occupiers adopt a measured approach amidst evolving geopolitical dynamics and AI-driven business transformations. Radha Dhir, Chief Executive Officer, India at JLL, emphasized the fundamental transformation underway across the sector.

Global Capability Centres (GCCs) are identified as a primary driver of this shift. GCCs accounted for 41.7 percent of the leasing activity. These centres leverage skilled talent in data science and AI to build analytics platforms and drive innovation.

Dhira added that there is unprecedented expansion being seen from the BFSI and manufacturing sectors, alongside new entrants from retail, logistics, infrastructure, and aerospace domains. This momentum is further fueled by co-working operators, which reached a record 10.23 million sq ft in H1 2026.

Implications for Office Market Strategy​

The data reflects a growing appetite for flexible and agile workspace solutions among both domestic and global occupiers. The surge in GCC activity and the rise of co-working space indicate a strategic evolution within India's office landscape.

JLL suggested that this shift signifies an increasingly diversified market, preparing it for continuous growth despite immediate concerns regarding corporate caution in decision-making.