According to a recent report by CBRE South Asia Pvt. Ltd. and the Hyderabad Software Enterprises Association (HYSEA), Hyderabad’s office stock is projected to exceed 200 million square feet by 2030. Currently, the city accounts for approximately 15 percent of India’s total office space and over 18 percent of the nation’s green-certified office stock. Since 2014, the rapid demand for office spaces from global firms has propelled Hyderabad’s office stock, which has tripled to nearly 137 million square feet as of December 2024. This remarkable growth positions Hyderabad as a prime destination for businesses seeking innovative and dynamic office environments. The report revealed a continued upward trend in 2024, with office absorption reaching an impressive 12.3 million square feet. The technology sector has been a key player in this growth, commanding a significant 31 percent share in leasing activity. Historically, the technology sector has dominated Hyderabad’s office absorption, contributing around 30-35 percent annually. However, recent years have seen a diversification in the city’s occupier base, with various sectors including flexible space operators, life sciences firms, and consulting companies increasingly establishing their presence in Hyderabad. This shift illustrates the city’s evolving landscape as a business hub.
Sector Diversification in Office Leasing
The landscape of office leasing in Hyderabad has transformed significantly, showcasing a trend towards diversification across various sectors. In 2024, life sciences firms accounted for 21 percent of the office leasing activity, while flexible space operators contributed 14 percent. This shift indicates a growing demand for office spaces beyond the traditional technology sector, as more industries recognize the advantages of being located in Hyderabad. The city’s appealing infrastructure, coupled with its reputation for a skilled workforce, makes it an attractive choice for diverse businesses. With global companies expanding their operations, Hyderabad has emerged as a major business and innovation hub, catering to sectors including IT, pharmaceuticals, biotechnology, and finance. The presence of Global Capability Centers (GCCs) also underscores this trend as they contribute significantly to the city’s office absorption. The GCCs are vital players in digital transformation, serving as strategic partners while attracting specialized talent in engineering, research and development, and information technology. This diversification in the occupier base not only showcases the resilience of Hyderabad’s real estate market but also highlights the city’s capability to adapt to changing business needs.
Hyderabad’s Thriving Tech Ecosystem and Future Prospects
Hyderabad’s vibrant tech ecosystem and extensive talent pool have solidified its status as a hub for Global Capability Centers (GCCs). The report emphasizes that GCC absorption in the city has seen a remarkable growth of over 12 percent from 2022 to 2024, reaching 5.3 million square feet in 2024. This growth is significant, accounting for nearly 43 percent of the total office space in Hyderabad last year. The city is now ranked second in GCC leasing in India, only behind Bengaluru, and continues to attract global corporations across various sectors. The relentless adoption of advanced technologies, such as artificial intelligence, cloud computing, and data analytics, fuels this growth further. With a robust infrastructure and a strong talent ecosystem, Hyderabad is well-positioned to support the evolving needs of these global corporations. As the city embraces innovation and diversifies its economic base, the outlook for its office space market remains positive. Businesses seeking strategic locations and access to specialized talent will likely continue to turn to Hyderabad, ensuring its growth trajectory remains strong in the coming years.
Conclusion: A Bright Future for Hyderabad’s Office Market
In conclusion, the report by CBRE South Asia Pvt. Ltd. and HYSEA presents a promising outlook for Hyderabad’s office market, projecting significant growth in the coming years. As the city approaches the milestone of 200 million square feet of office stock, its status as a preferred destination for diverse businesses is reinforced. The diversification in the occupier base, particularly with the rise of life sciences firms and flexible space operators, highlights the adaptability and resilience of Hyderabad’s real estate market. Furthermore, the city’s robust tech ecosystem and the presence of Global Capability Centers serve as critical drivers of growth, ensuring that Hyderabad remains an attractive hub for global corporations. With a favorable business environment, skilled workforce, and advanced technological infrastructure, Hyderabad is poised for continued success. The future holds great potential for both businesses and the commercial real estate sector, solidifying the city’s reputation as a leading economic center in India.
