At the end of Q3 2016, India’s total Grade A office stock stood at 472 million square feet with an average vacancy rate of 15.3%. The average vacancy rate has been declining since 2013 amid strong demand from domestic as well as international office occupiers, and this trend is forecast to continue in the medium to long term.
If we look at the vacancy rate in cities, most are well placed except certain sub-markets of the National Capital Region (NCR) and Mumbai, which are skewing up the pan-India average (Figure 1). The NCR alone contributes about 41% to total pan-India vacant stock of 72 million square feet, followed by Mumbai contributing about 28% while Bengaluru, the second biggest office market in size after Mumbai, contributes just 4.2% to pan-India vacant stock.
Read more: IIFL