Hyderabad commercial real estate has emerged as one of India’s fastest-growing real estate markets.
According to a report published by CIRIL(Commercial, Investment, Retail, Industrial, Logistics, and Land Services) a real estate consultancy, established in 2015, has quickly become a prominent name in commercial real estate.
CIRIL’s experience is concentrated solely in the commercial, industrial, retail, investment land, and logistics sectors.
While a relatively young company, CIRIL’s foundation rests upon decades of experience in real estate consulting.
They operate much like other international property consultants, having been formed by seasoned consultants with extensive market knowledge across cities in India. Having 37 offices all over India spanning from Delhi to Cochin – Rajkot in Gujarat to Guwahati in Assam.
CIRIL Chairman Vijay Sarathi’s Insights on Hyderabad Commercial Real Estate Market:
“Hyderabad is the place to be for GCC companies right now,” he declared. “We’ve seen massive traction in the last financial year – huge spaces being snapped up. And this year? Operations are kicking off!
He painted a picture of a city transforming. “Google’s coming in big, They’re not just renting; they’re building their campus. Microsoft’s expanding, and Infosys, of course, is already a major player here.”
Mr. Sarathi added, “What’s driving Hyderabad commercial real estate growth is global backend operations. We have the manpower – the right skill sets – and big companies are choosing Hyderabad for their backend hubs. We’re seeing a lot of UK-based companies setting up office space here.”
“Every 100 square feet of commercial space converts into 1,000 square feet of residential space over time. Hyderabad’s 10 million square feet might be transformed into several units throughout time.”
CIRIL Report on Hyderabad Commercial Real Estate: 2024 Highlights
In 2024, Hyderabad experienced the absorption of over 12.5 million square feet, establishing it as a significant market.
Regarding Hyderabad commercial leasing operations in India. The city represented 19% of the total 66.4 million square feet of Grade A space leased nationwide in 2024.
During the year, IT-BPM constituted 33% (4.0 million sq.ft) of the total Grade A office space leased in the city, while Healthcare and Pharma represented 16% (2 million sq.ft), and flexible office providers occupied 14% (1.8 million sq.ft) of the space in Hyderabad.
The Global Capability Centres (GCC) significantly contributed to a 70% year-on-year increase in volume growth in Hyderabad’s office sector.
The new office supply in the city was documented at 8.2 million square feet in 2024. The average rental rate rose by 4% to Rs 68 per square foot per month.
The Madhapur/Raidurg submarket maintained its preeminence, representing 75% of all leasing activity in 2024, while the Gachibowli market comprised 20% of overall leasing. The vacancy rate was approximately 15% due to robust leasing activities.
The rental rates for Hyderabad commercial real estate in most micro markets remained consistent due to vigorous leasing activities in key locations.
Sub-markets including Madhapur, Gachibowli, and the Financial District experienced rental appreciation in Grade A office space, accompanied by elevated premiums cited by developers.
Approximately 14 million square feet of space is anticipated to be introduced in Hyderabad’s micro-markets within the next 24 months.
Hyderabad Commercial Real Estate RETAIL Trends: CIRIL REPORT
The Hyderabad retail industry experienced robust absorption of over 1.8 million square feet of space in 2024. Retail leasing saw one of the most successful years following COVID says CIRIL Report.
Leasing is predominantly observed in Banjara Hills, Jubilee Hills, Secunderabad, Madhapur, Manikonda, and Kondapur.
In 2024, the primary demand drivers in the retail sector included Fashion, Jewellery, Accessories, Home Décor, Hypermarket, and Food and Beverage.
A total supply of 0.75 million square feet was introduced in 2024. Rental rates remained consistent throughout most micro-markets, although they experienced appreciation in specific areas such Madhapur, Somajiguda, Kukatpally, Banjara Hills, Kondapur, and Himayat Nagar, attributed to a scarcity of high-quality retail space and elevated demand from retailers.
The city mall rentals are anticipated to remain stable over the forthcoming quarters, considering the supply. The year 2025 appears to be another favorable year for Hyderabad’s retail business.
Industrial and Warehousing Trends: CIRIL Report
The Hyderabad warehousing market recorded sales of approximately 2.15 million square feet in 2024, positioning Hyderabad among the top five. Warehousing marketplaces in India.
Summing Up:
Hyderabad’s commercial real estate sector is certainly thriving, according to CIRIL’s 2024 study.
From robust office space absorption driven by GCCs and IT-BPM to a healthy retail sector experiencing significant growth and a warehousing market holding its own, the city’s real estate landscape depicts dynamic expansion that will improve employment opportunities and purchasing capacity for residential real estate.
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