The Reinvention of the Indian Office: A Decade of Growth and Hybrid-Powered Expansion

India's office market is undergoing a significant transformation, driven by a powerful combination of robust business growth and the widespread adoption of hybrid work models. This dual-engine growth is not only pushing the market to new heights but also redefining the very nature of the modern workplace.

Here’s a structured breakdown of the key trends shaping India's commercial real estate landscape over the next two years.

The Big Picture: A Market on the Rise

The outlook for India's office market is exceptionally strong, with a clear trajectory of expansion. Businesses are moving beyond the initial post-pandemic uncertainty and are now actively planning for larger, more dynamic office portfolios.

• Portfolio Expansion: A notable 85% of domestic firms in India are planning to expand their office portfolios over the next two years. This is a significant jump from 73% in 2024, signaling a strong return to in-person collaboration.
• The Return-to-Office Mandate: The majority of companies are embracing a structured return-to-office approach. A recent CBRE South Asia survey found that 94% of firms want employees in the office at least three days a week, with a striking 52% mandating a full-time return—up from 36% in 2024.
• A Decade of Reinvention: According to Anshuman Magazine, CEO of CBRE South Asia, the market is entering a "decade of resilience and reinvention." The focus is on creating future-ready, high-performance workspaces that are digitally integrated and built with sustainability in mind.

Global Capability Centres (GCCs): The New Powerhouse

Global Capability Centres (GCCs) are a key driver of this growth, cementing India's position as a global hub for innovation. These centers are evolving from simple back-office operations into hubs for cutting-edge work in fields like AI, engineering, and life sciences.

• Dominant Market Share: GCCs currently account for a substantial 35-40% of office absorption in India.
• Rapid Expansion: The momentum is set to continue, with approximately 65% of GCCs planning to expand their operations in the next two years. This growth is particularly prominent in the banking, financial services, life sciences, engineering, and manufacturing sectors.
• Larger Deal Sizes: The average deal size for GCCs has increased to around 108,000 sq ft in the first half of 2025, up from 91,000 sq ft in 2024.
• Focus on Sustainability: ESG (Environmental, Social, and Governance) targets are a growing priority, with 75% of GCCs having already set them in place.

The Rise of Flexible Workspaces

Hybrid work models have catalyzed a new demand for flexible, agile office solutions. This has led to a boom in the flexible workspace sector, with companies integrating these spaces into their core real estate strategy.

• Increased Leasing Activity: Flexible workspace operators now account for over 15% of total office leasing activity.
• Strategic Portfolio Allocation: The proportion of companies that plan to allocate 26-50% of their portfolios to flexible spaces is projected to more than double in the next two years.
• A Solution for All: This trend is not limited to large corporations. Among smaller occupiers, 58% plan to allocate more than 10% of their portfolio to flexible spaces. This is also on the rise for larger occupiers, with a forecast to increase from 33% to 52% by 2027.

A Strong Domestic Rebound and Tier-II City Growth

The Indian office market's resurgence is also being fueled by domestic firms. Their leasing activity has rebounded spectacularly, surpassing pre-pandemic levels.

• Robust Domestic Leasing: Office leasing by domestic firms in 2023-24 was a remarkable 86% higher than pre-COVID levels in 2018-19, indicating a strong preference for larger and more flexible spaces.
• Emerging City Hubs: Expansion interest is spreading to smaller cities, where companies are finding a rich talent pool, significant cost advantages, and improving infrastructure. This decentralization of growth points to a more widespread and resilient office ecosystem across the country.

In conclusion, the Indian office market is not just recovering; it's evolving into a more dynamic, innovative, and sustainable ecosystem. The convergence of business expansion, the maturation of GCCs, and the strategic integration of flexible workspaces positions India's commercial real estate for sustained growth and reinvention.