Large office lease agreements in Mumbai and the National Capital Region (NCR) are reaching premium rates in certain micro-markets, despite significant price variations between different areas. Consultants attribute this premium nature to the limited supply of high-quality Grade A spaces and sustained demand from tenants.
Data analysis provided by Propstack shows rate variability based on five of the largest registered office deals in the cities for 2026. In the Mumbai Metropolitan Region (MMR), the University of Western Australia-India leased 116,540 square feet in Andheri East at a rate of 205 rupees per square foot per month, while Amazon Data Services India occupied 174,176 square feet in Powai at 159 rupees per square foot per month.
In Delhi, Hero MotoCorp signed a deal for 231,108 square feet in Aerocity at a price of 215 rupees per square foot per month. In Gurugram, Google India leased 617,448 square feet for 171 rupees per square foot per month, while Accenture leased 164,881 square feet in Noida at 192 rupees per square foot per month.
However, the data also indicates that these expensive deals are concentrated in specific micro-markets and do not reflect market-wide rates. Push Jain, Managing Director of Commercial Leasing and Advisory at Anarock Group, noted that commercial real estate rental costs depend not only on demand but also significantly on land cost and availability.
He added that in the prestigious central business districts of NCR and MMR, there is a scarcity of land for new construction compared to Bengaluru and Hyderabad. Jain pointed out that the average rental rate in the Bandra-Kurla Complex (BKC) in MMR is around 350–570 rupees per square foot per month, whereas in the Central Business District (CBD) of Bengaluru, it ranges from 130–230 rupees per square foot per month.
According to Jain, in markets with high rates, the volume of leases is constrained by the lack of quality stock, not weak tenant interest. CBRE consultants believe that the premium rental rate in Mumbai and Delhi-NCR is primarily driven by the supply deficit in key micro-markets, combined with the trend of tenants opting for higher-quality properties.
In Mumbai, the deficit is observed regarding available Grade A+ adjacent spaces in modern, ESG-compliant buildings in the BKC and BKC Periphery areas, as well as in Gurugram on Golf Course Road and NH-8. According to CBRE, previously quoted rates rose by 2–7 percent in Mumbai and by 2–4 percent in Delhi-NCR during the second quarter of 2026.
Nevertheless, US-based consultants Cushman & Wakefield cautioned against extrapolating the most expensive deals across the entire Delhi-NCR market. Their data shows that Mumbai is the most expensive market, followed by Bengaluru, Hyderabad, and Delhi-NCR, with Chennai having the lowest rates among these markets.
Vira Babu, Executive Managing Director for Tenant Representation in India at Cushman & Wakefield, explained that Delhi-NCR's fourth place is due to a relatively higher vacancy rate, even despite active leasing in 2025 and the first half of 2026, which brought rates closer to Hyderabad's level. Babu also noted that vacancy in Mumbai is steadily decreasing as demand outpaces supply growth, leading to one of the highest rent growth rates among major cities.
In Delhi-NCR, supply also increased significantly in 2025, leading to a relatively high aggregate vacancy, although it has been declining in recent quarters. Hardeep Dayal, President (Commercial) of Bhartiya Urban from Bengaluru, stated that city-level availability does not guarantee suitable space for every tenant. Companies are increasingly making specific demands regarding Grade A quality, floor plan, sustainability, connectivity, amenities, and technological infrastructure, narrowing the pool of truly interchangeable stock. He emphasized that premium rent is a function of both asset-specific supply constraints and the depth of tenant demand.
Furthermore, Bengaluru traditionally dominates office leasing volumes in India, showing transactions worth 14.1 million square feet in the first half of 2026, exceeding the figures of any other major Indian market. Industry experts note that leasing volumes and rental rates are determined by various factors, with tenants considering talent, ecosystem depth, Grade A supply, connectivity, operating costs, and scalability.
Propstack transactions also demonstrate diversification of tenant demand beyond traditional tech companies. The data showed that IT/ITeS is the largest tenant, followed by non-IT Global Capability Centers (GCCs), flexible space operators, automotive industry and manufacturing, as well as BFSI (Banking, Financial Services, and Insurance). Harsh Binani, co-founder of flexible space provider Smartworks, stated that modern demand is much broader from a sectoral perspective than a few years ago. He cited an example where about 75 percent of Smartworks' new revenue in the first quarter of the 2027 fiscal year came from non-IT sectors, including BFSI, consulting, engineering, and manufacturing, highlighting portfolio diversity.
Cushman & Wakefield forecasts that Mumbai and Delhi-NCR will lead in rent growth over the next two to three quarters, supported by healthy demand and relatively lower supply in key locations.