Hyderabad Records Strongest-Ever First-Quarter Office Leasing in 2026
Hyderabad, the capital of Andhra Pradesh in India, has seen its strongest-ever first-quarter office leasing in 2026, with gross leasing volume touching 3.15 million square feet. This significant milestone is driven by sustained demand from large occupiers, as per a report by real estate consultancy firm Cushman & Wakefield.
Key Highlights:
- Gross Leasing Volume: 3.15 million square feet in Q1 2026
- Year-on-Year Rise: 21.6 per cent in office leasing
- City's Contribution: 14 per cent of India's total office gross leasing volume
Leasing Activity Breakdown:
- Large transactions (over 100,000 sq. ft.) contributed 81 per cent of the total leasing volume
- Mid-sized deals (25,000 - 99,999 sq. ft.) made up another 17 per cent
Micro-Market Analysis:
The report noted that leasing remained heavily concentrated in the Madhapur micro-market, which accounted for 91 per cent of total office space leased in the city during the quarter.
Supply and Demand:
- No new office completions in the quarter
- Net absorption of 2.21 million square feet, reflecting continued demand from occupiers
- Vacancy levels down by 260 basis points year-on-year to 20.22 per cent
Rental Trends:
- Average office rentals in the city rose 11.6 per cent year-on-year to Rs 92.2 per square feet
- Highest recorded rental rate so far
Sector-Wise Breakdown:
- IT-BPM sector accounted for 36 per cent of leasing activity
- Flexible workspace operators accounted for 30 per cent
- BFSI firms accounted for 23 per cent
Global Capability Centres (GCCs):
- GCCs accounted for 0.83 million square feet of office leasing, or 26 per cent of Hyderabad's total leasing volume
- Reinforcing the city's growing role as a key GCC hub
Expert Insights:
"Hyderabad has seen a strong start to 2026, with gross leasing volumes reaching a new high for the first quarter. The city continues to hold a strong position within India's office market and stands out for its ability to accommodate large occupier requirements, even as availability tightens across several key markets," said Veera Babu, Executive Managing Director, Cushman & Wakefield.