July 25, 2025:
Flex spaces accounted for 14% of total absorption in Q2 2025, up from 9% in the previous quarter. The area absorbed by flex spaces increased by 68% over the previous quarter, reaching 2.63 Mn sq ft in Q2 2025. Moreover, the southern cities of Bengaluru, Chennai and Hyderabad accounted for nearly 80% of the area absorbed by flex spaces across the top seven cities, underscoring the growing prominence of flex spaces in these cities.
Even though the share of flex spaces has increased significantly, IT‑ITeS sector continued to dominate absorption with 9.4 Mn sq ft in Q2 2025. Nearly half of the absorption by IT‑ITeS sector was concentrated in the localities of Yeshwantpur (Bengaluru), Nanakramaguda (Hyderabad), and Airoli (Mumbai). The top seven cities recorded 36.75 Mn sq ft of absorption in H1 2025, registering 21% increase over the same period a year earlier. With this growth rate, we anticipate absorption to surpass 75 Mn sq ft by the end of 2025, potentially reaching the highest‑ever absorption in any calendar year.
Sector Absorption (Mn sq ft) Absorption (% share in pan‑India)
Q2 2025 Q1 2025 Q2 2024 Q2 2025 Q1 2025 Q2 2024
IT‑ITeS 9.4 6.5 7.5 50% 36% 44%
Flex Spaces 2.6 1.6 1.3 14% 9% 8%
BFSI 1.1 3.7 2.1 6% 20% 12%
Others* 5.6 6.2 6.1 30% 35% 36%
*Other sectors include Aviation, Consulting Services, Engineering & Manufacturing, Retail, Healthcare & Lifesciences, Infra, Real Estate & Logistics, Electronics, Automotive, E‑commerce, FMCG/FMCD, Telecom & Media, Metals & Mining, and Energy.
The second quarter of 2025 maintained its growth momentum amid global macroeconomic uncertainties and geopolitical frictions. As a result, absorption rose by 10% annually and 5% quarterly, reaching 18.79 Mn sq ft in Q2 2025. This could be attributed to the significant increase in real estate activities in the southern cities, with their share rising from 46% in Q1 2025 to 59% in Q2 2025.
Mr. Shrinivas Rao, CEO, Vestian, said, “India’s office market continued to grow in Q2 2025, largely driven by robust absorption in major cities like Bengaluru, Hyderabad, and Mumbai. As more enterprises are transitioning back to in‑office operations and several grade‑A office projects are planned to be completed in the second half of 2025, the growth momentum is anticipated to continue with an increase in office utilisation ratio.”
