Hyderabad office space market is trending very high, all set to draw more demand from national and international companies. From the latest analysis by Cushman & Wakefield, the Gross Leasing Volume or GLV for the first half of the year 2024 or H1 is set to hit 5 million per sq feet, an increase of 40% compared to 3.6msf investment recorded in the first half of H1 2023. This positive momentum of the Hyderabad IT industry is said to be cascading an effect of enterprises continuing to flock into Hyderabad and thereby, strengthening Hyderabad’s position of being one of the favored business hubs, as mentioned in the report.
According to the report in Hyderabad Office Space Market, the IT-BPM(Business Processing Management) industry remained on the top with a 36 % market share in gross leasing whereas BFSI(Banking Financial Service industry) took a rapid growth with 29 % shares of the total leasing space in the H1 2024. These growths could be because of the increase in the establishment of major BFSI organizations in Hyderabad, the report also stated.
Experts said that several reasons have led to Hyderabad’s office space market experiencing a boom. “They also pointed to a favorable business environment exemplified by improved business infrastructure, complied regulations, and stability in the political environment also supported by the affordable square footage for investment and occupancy as well as a readily available qualified workforce compelling investors, occupants, and leading real estate developers to Hyderabad,” they said.
“The prime submarket of Madhapur remained consistent, comprising 83 percent of the leasing activities in H1 2024,” it said, but added, “Due to limited availability of supply in Hitec City, the Gachibowli market is likely to witness an upsurge within the next 2-3 years.”
The report highlighted that though the overall vacancy rate in Gachibowli stands at approximately 47% there is a differential trend prevalent in the submarket indicating that premium developments are wiping off vacancy rates faster than the norm. It said Madhapur’s vacancy dip was likely to touch single digits in the next two quarters.
Hyderabad Office Space Q2 Market Statistics:
| Q2 Market Statistics | |||
| Submarket | Inventory (Sq.feet) | YTD Gross Leasing(Sq.ft) | Vacancy Rate |
| Madhapur | 6,56,58,869 | 41,73,278 | 12.32% |
| Gachibowli | 3,70.98,085 | 9,62,637 | 46.75% |
| Peripheral East | 22,58.000 | 41.77% | |
Check out flats for sale in Madhapur, Gachibowli, Hyderabad.
The increase in the number of units leased out for office space has a triggering effect that is spreading well beyond the business domain. It is stimulating demand not only in the residential segment but also in such segments as co-living, student housing, and others.
Thus, the intended growth path puts Hyderabad on the map as one of the leading markets for office spaces in India; a ripe environment that has several indicators that make it possible for businesses to grow, said the sources.