Office Space Absorption in India Rises 19% in 2024 Q3

The demand for office space across India’s top seven cities surged by 14% year-on-year in the third quarter of the fiscal year, driven by increased absorption. According to a report by real estate consultancy JLL, net office space absorption reached 12.16 million square feet between July and September 2024, up from 10.69 million square feet during the same period in 2023.

What is Net Absorption?
Net absorption refers to the total floor space occupied by businesses, minus the space vacated. This metric is a critical indicator of office space demand and growth in commercial real estate.

City-Wise Breakdown

• Bengaluru recorded the largest surge in net Office Space absorption, climbing to 4.14 million square feet, a notable increase from 2.38 million square feet in the previous year.
• Chennai recorded a moderate growth with 1.05 million square feet absorbed, up from 0.90 million square feet.
• Delhi closely trailed, with net Office Space absorption reaching 1.92 million square feet, up from 1.7 million square feet in the previous year.
• Mumbai posted 1.85 million square feet of net absorption, a rise from 1.53 million square feet.
• Pune also showed growth, with absorption climbing to 1.8 million square feet from 1.34 million square feet.
• Hyderabad was the only city to witness a decline, with net absorption dropping to 1.26 million square feet, down from 2.70 million square feet last year.
• Kolkata saw a slight decrease, falling to 0.13 million square feet from 0.14 million square feet in the same period last year.

Nine-Month Snapshot
During the first nine months of 2024, India’s total net office space absorption reached 31.03 million square feet, marking a 19% growth compared to the previous year.JLL highlighted that this level of demand is second only to the same period in 2019, underscoring strong corporate expansion activity. This growth indicates ongoing capacity building by both domestic and global firms in the country.

India’s Role in Global Occupiers’ Strategies
Shesh Rao Paplikar, Founder & CEO of Bhive Group, a leading flexible workspace provider, emphasized India’s central position in global occupier strategies. “We expect sustained growth in the coming quarters, further strengthening India’s standing as a premier office space destination,” Paplikar stated.

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