Hyd hit record office leasing: Knight Frank

Hyderabad: Hyderabad has recorded its highest-ever quarterly office leasing activity, with transactions touching 5.86 million sq ft in the first quarter of 2026, according to a report by Knight Frank India. The milestone reflects a strong 48 per cent year-on-year growth from 4.0 million sq ft in Q1 2025, positioning the city as the second-largest office market among India’s top eight cities.

The report, titled India Real Estate: Office and Residential (January–March 2026), highlights a parallel rise in rental values, with average office rents increasing 8 per cent year-on-year to Rs77.5 per sq ft per month. New office completions stood at 2.3 million sq ft during the quarter, indicating a steady supply pipeline amid robust demand.

A key driver of this growth has been Global Capability Centres (GCCs), which accounted for 43 per cent of total leasing, translating to 2.5 million sq ft—up 53 per cent from the previous year. Third-party IT services firms followed with a 29 per cent share, leasing 1.7 million sq ft. Notably, flexible workspaces witnessed a sharp surge, with absorption rising 457 per cent year-on-year to 1.42 million sq ft, largely driven by large enterprises and GCCs.

Commenting on the trend, Joseph Thilak, National Director – Occupier Strategy and Solutions (Hyderabad and Chennai) at Knight Frank India, stated that the city’s strong demand-supply dynamics and diversified occupier base have contributed to record transaction volumes and rising rental values.