India set to become fourth-largest office market as stocks nears 1 billion sq ft

India is on the verge of becoming the fourth-largest office market globally, with its office stock set to cross 1 billion square feet by the third quarter of 2025, property consultant Knight Frank India has said in a report.

Cumulative office stock across the top eight Indian cities stood at 993 million sq ft in the first half of 2025, the report “A Billion sq ft and Counting – India Office Supply Growth Story” has said. Bengaluru, the National Capital Region (NCR), which includes Delhi, and Mumbai together account for nearly 60 percent of India’s total office stock.

Bengaluru leads with 229 million sq ft (23 percent) followed by NCR at 199 million sq ft (20 percent) and Mumbai 169 million sq ft (17 percent).

“As we prepare to cross the 1 billion sq ft threshold, it’s not just a number, it reflects the growing institutionalisation, maturity, and global relevance of India’s office market,” said Shishir Baijal, chairman and managing Director, Knight Frank India. “This transformation has been powered by an ecosystem of world-class developers, investors, and occupiers who have continually raised the bar in creating dynamic, sustainable workspaces.”

India’s office market has expanded at a compound annual growth rate (CAGR) of 8.6 percent over the last two decades, growing from under 200 million sq ft in 2005 to its current scale.

Knight Frank projects that India could add another billion square feet between 2036 and 2041, depending on the pace of expansion.

The market evolution has been driven by structural reforms, demand from global capability centres, and sustained investment in infrastructure and real estate quality.

Office stock snapshot

The office stock is valued at Rs 16.07 trillion ($187 billion). Grade A spaces comprise 53 percent of the total, followed by Grade B (43 percent) and Grade C (4 percent). Bengaluru, Hyderabad, and Chennai lead in Grade A stock due to high information technology and global capability centre demand, while legacy markets such as Mumbai and the National Capital Region show a more balanced grade distribution.

“India’s office market is at a defining moment. Poised to cross the 1 billion sq ft threshold in 2025 with 0.99 billion sq ft already achieved, India has become the world’s fourth-largest office market. This milestone speaks to the sheer scale of our commercial real estate, but more importantly, it underscores the sector’s resilience, institutional strength, and unwavering growth trajectory,” Gulam Zia, senior executive director– research, advisory, infrastructure, and valuation, Knight Frank India, said.

The world’s three largest office markets are the United States, China, and Japan.

India’s cost competitiveness remains a key strength. With average rents at $0.96/sq ft/month in 2025, the market continues to offer high-quality yet affordable workspaces. However, further policy and capital interventions are essential to bridge future supply gaps and avoid rental inflation, the reports said.

According to Knight Frank’s analysis, 30 percent of India’s current office stock is ageing and retrofit-ready, particularly in key business districts, highlighting a significant opportunity for redevelopment.