New Delhi, July 25, 2025: Flex spaces accounted for 14% of total absorption in Q2 2025, up from 9% in the previous quarter. The area absorbed by flex spaces increased by 68% over the previous quarter, reaching 2.63 Mn sq ft in Q2 2025. Moreover, the southern cities of Bengaluru, Chennai and Hyderabad accounted for nearly 80% of the area absorbed by flex spaces across the top seven cities, underscoring the growing prominence of flex spaces in these cities.
Even though the share of flex spaces has increased significantly, IT-ITeS sector continued to dominate absorption with 9.4 Mn sq ft in Q2 2025. Nearly half of the absorption by IT-ITeS sector was concentrated in the localities of Yeshwantpur (Bengaluru), Nanakramaguda (Hyderabad), and Airoli (Mumbai). The top seven cities recorded 36.75 Mn sq ft of absorption in H1 2025, registering 21% increase over the same period a year earlier. With this growth rate, we anticipate absorption to surpass 75 Mn sq ft by the end of 2025, potentially reaching the highest-ever absorption in any calendar year.
| Sector | Absorption (Mn sq ft) | Absorption (% share in pan-India) | ||||
| Q2 2025 | Q1 2025 | Q2 2024 | Q2 2025 | Q1 2025 | Q2 2024 | |
| IT-ITeS | 9.4 | 6.5 | 7.5 | 50% | 36% | 44% |
| Flex Spaces | 2.6 | 1.6 | 1.3 | 14% | 9% | 8% |
| BFSI | 1.1 | 3.7 | 2.1 | 6% | 20% | 12% |
| Others* | 5.6 | 6.2 | 6.1 | 30% | 35% | 36% |
*Other sectors include Aviation, Consulting Services, Engineering & Manufacturing, Retail, Healthcare & Lifesciences, Infra, Real Estate & Logistics, Electronics, Automotive, E-commerce, FMCG/FMCD, Telecom & Media, Metals & Mining, and Energy.
Source: Vestian Research
The second quarter of 2025 maintained its growth momentum amid global macroeconomic uncertainties and geopolitical frictions. As a result, absorption rose by 10% annually and 5% quarterly, reaching 18.79 Mn sq ft in Q2 2025. This could be attributed to the significant increase in real estate activities in the southern cities, with their share rising from 46% in Q1 2025 to 59% in Q2 2025.
Mr. Shrinivas Rao, CEO, Vestian, said, “India’s office market continued to grow in Q2 2025, largely driven by robust absorption in major cities like Bengaluru, Hyderabad, and Mumbai. As more enterprises are transitioning back to in-office operations and several grade-A office projects are planned to be completed in the second half of 2025, the growth momentum is anticipated to continue with an increase in office utilisation ratio.”
Office Market Summary: Q2 2025
| City | Absorption (Mn sq ft) | Y-o-Y Change (%) | Q-o-Q Change (%) | New Completions (Mn sq ft) | Y-o-Y Change (%) | Q-o-Q Change (%) |
| Bengaluru | 5.62 | 32% | 38% | 3.90 | 11% | 11% |
| Chennai | 1.82 | 4% | 13% | 1.50 | 114% | 1,400% |
| Hyderabad | 3.56 | 5% | 34% | 2.70 | -7% | NA |
| Mumbai | 3.45 | 2% | -14% | 1.10 | -67% | 267% |
| Kolkata | 0.35 | 52% | 52% | 0.00 | NA | NA |
| Pune | 1.37 | -52% | -49% | 4.30 | 760% | 48% |
| NCR | 2.62 | 130% | -4% | 1.20 | -20% | -54% |
| Total | 18.79 | 10% | 5% | 14.70 | 19% | 55% |
Source: Vestian Research
City-wise Analysis
- Bengaluru: After reporting a decline for two consecutive quarters, absorption rebounded in Q2 2025 and reached 5.62 Mn sq ft. Absorption increased by 38% over the previous quarter and 32% compared to the same quarter a year earlier.
- Chennai: Chennai witnessed an absorption of 1.82 Mn sq ft in Q2 2025, registering an increase of 13% over the previous quarter and 4% compared to the same period a year earlier. Despite a significant quarterly increase in absorption, the city’s share in pan-India absorption remained largely stable at 10% in Q2 2025.
- Hyderabad: The city reported an absorption of 3.56 Mn sq ft in Q2 2025, registering an increase of 34% over the previous quarter and 5% compared to the same quarter a year earlier.
- Mumbai: The city registered an absorption of 3.45 Mn sq ft in Q2 2025, accounting for 18% of the pan-India absorption. It has decreased by 14% compared to the previous quarter despite witnessing a yearly increase of 2%.
- Kolkata: The city recorded 0.35 Mn sq ft of absorption in Q2 2025, the highest in the last two years. The absorption increased by 52% compared to the previous quarter and the same period of the preceding year.
- Pune: Absorption declined by 52% over the previous year and 49% compared to the previous quarter, reaching 1.37 Mn sq ft in Q2 2025. Following the same trend, the city’s share in pan-India absorption dropped sharply to 7% in Q2 2025 from 15% in Q1 2025 and 17% in Q2 2024.
- NCR: Absorption decreased by 4% compared to the previous quarter despite witnessing a significant yearly increase of 130%, reaching 2.62 Mn sq ft in Q2 2025.