Grade A office rentals jump up to 20% in Q1 2026 as GCCs make a beeline for India

Bengaluru recorded the highest growth of 11 per cent in Q1 2026 against the preceding quarter.

Bengaluru: Aided by an increasing demand from the global capability centres (GCCs), the Grade A office markets have witnessed a robust growth of up to 20 per cent in rentals during the first quarter of 2026. According to data trends put out by property consultant Anarock, average office monthly rentals across the top 7 cities rose to Rs 93 per square feet.

Bengaluru recorded the highest growth of 9 per cent year-on-year in 2025 against 2024, and the city continued this trend by recording the highest 11 per cent growth in Q1 2026 against the preceding quarter (Q4 2025).

Average rentals for Grade A office space in Bengaluru went up to Rs 105 per sq feet per month in Q1 2026 compared to Rs 95 per square foot per month in Q1 2025, recording a growth of 11 per cent YoY. Bengaluru is followed by the Mumbai Metropolitan Region, where rentals rose to Rs 152 per square foot in Q1 2026 from Rs 141 per square foot, an 8 per cent growth over the same period a year ago. Rentals in NCR, Chennai, and Hyderabad went up 7 per cent year on year.

The premium in rentals is owing to a huge demand for Grade A offices by GCCs, MNCs, and institutional occupiers. GCCs leased 9.87 million square feet across the country with Bengaluru contributing 40 per cent.

Grade A buildings provide F&B, wellness, retail, smart building tech, and high security infrastructure which are mostly not available in mid-tier assets, Anarock said.

Multinational corporations insist on LEED and IGBC certifications, effectively ruling out mid-tier buildings from consideration, even with good location attributions. GCCs and financial services companies that operate around the clock need reliable power, IT infrastructure and building management.

New supply of Grade A office space

The top 7 cities added 52 million square feet of new Grade A office supply in 2025, up 8 per cent YoY. The southern markets led with 52 per cent of new supply, Bengaluru added ~14 million square feet (+12 per cent YoY), Chennai saw a 72 per cent YoY supply boom (signalling confidence in its tightening fundamentals), and Pune was the national star with 103 per cent YoY growth. Hyderabad saw a 31 per cent drop to ~8.8 Million square feet on a more conservative phased delivery pipeline.

Interestingly, Q1 2026 saw new office completions decline 18 per cent on an annual basis – from approx. 10.53 Million square feet in Q1 2025 to approx. 8.60 Million square feet in Q1 2026. This decline could be partially attributed to the war in West Asia and its impact on the overall global market.

Peush Jain, Managing Director - Commercial Leasing & Advisory, ANAROCK Group, says, "India’s Grade A office market had its best year on record in 2025. The demand anchor was the southern markets, which absorbed a combined 29.35 million square feet in Bengaluru, Hyderabad and Chennai. These markets accounted for half of India’s total net office absorption in 2025. Bengaluru remains the top contributor with 14.95 million square feet, a 26 per cent national share. But it is now witnessing moderating growth at 1 per cent YoY."