Bengaluru gross office leasing volume hits 11.8m sq ft in H1

This is the second consecutive half-yearly volume above 10m sq ft.

The Bengaluru SBD submarket dominated office absorption according to a JLL report, primarily in ORR North and South-East, with large deals (>50,000 sq ft) representing 80% of fresh deals. Despite no new supply in these clusters, occupier activity confirmed these submarkets’ enduring appeal.

“Q2 GLV reached 7.53 million sq ft, bringing H1 2025 to 11.8 million sq ft-the second consecutive half-yearly gross lease volume above 10 million sq ft. Tech reclaimed the lead with 40% share in leasing activity, increasing its space take-up by 1.6 times from Q1,” the report added.

Here’s more from JLL:

SBD City led Bengaluru’s Q2 supply with a 30% share, followed by SBD North, Whitefield, and SBD South. Grade A developers provided over one-third of new supply, highlighting the market’s continuing focus on sustainability and modern workplace features.

Office market vacancy rose slightly by 60 bps to 12.0% in Q2 driven by the substantial new supply. Submarkets with new inventory saw rising vacancies, while CBD and Electronic City showed reduced rates, indicating consistent city-wide absorption.

Rentals grow 7.3% y-o-y as leading developers set above-market rates in prime submarkets with limited availability

Bengaluru’s office market shows a strong shift toward quality enhancement with developers pursuing green certifications through property upgrades. This sustainability focus resulted in rental appreciation for environmentally certified buildings across submarkets.

Capital values increased by 9.6% y-o-y as investor interest remained healthy for high-quality assets with strong tenant profiles. Portfolio deals are being looked at, indicating growing investment interest in the city’s office assets.

Outlook: Bengaluru’s office market poised for growth as global firms continue to expand their tech and back-office operations

Tech dominates office demand, but manufacturing, fintech, and co-working sectors are growing. Future expansion spans across manufacturing, healthcare/biotech, financial services, flex spaces, engineering R&D, and select IT firms responding to evolving workplace trends.

Bengaluru’s office market absorbs new supply while maintaining rent growth, fostering a positive investment climate. Capital values should continue rising as demand persists amid strong fundamentals and growth prospects attracting domestic and international investment.