India accounted for over 70% of total office leasing volume across key Asia-Pacific markets in the first half of 2026. This trend highlights the country's growing importance as a hub for global business operations, primarily driven by the expansion of Global Capability Centres. While demand remains robust, investors should monitor the impact of construction costs and shifting global economic conditions on long-term rental yields.
India's commercial real estate market secured a commanding position in the Asia-Pacific (APAC) region during the first half of 2026. Industry data shows the country captured more than 70% of total office leasing volume across 11 key markets, highlighting its growing appeal to global enterprises. Total leasing in the APAC region reached 4.6 million square meters, a 3% increase from the previous year. This growth was largely powered by India, China, and Japan, which together contributed over 95% of the total activity.
A major factor behind this demand in India is the rapid expansion of Global Capability Centres (GCCs). These units, which manage technology and business operations for multinational firms, are increasingly drawn to India due to the availability of skilled talent and significant cost advantages compared to other regions. As these centres grow, the need for premium, "Grade A" office space has risen steadily.
While demand is trending upward, supply has become tighter. New office supply across the tracked APAC markets dropped by 37% year-on-year to 3 million square meters. India and China were responsible for over 80% of this new space. For investors and developers, this supply contraction is a critical metric. As high-quality office space becomes scarcer relative to rising demand, it generally supports rental growth and keeps asset values stable. This scarcity is helping to balance the market and maintain occupancy levels in key business hubs.
Despite the positive momentum, investors should remain aware of potential challenges. Geopolitical uncertainty and international trade tensions can impact the pace of global business expansion, which directly influences office space needs. Furthermore, persistent inflationary pressures and rising prices for raw materials like steel and cement could increase construction costs. This may put pressure on developer profit margins if these higher costs cannot be passed on to tenants through increased rents.
Additionally, while the office sector remains a preferred investment destination, the broader economic climate requires a cautious watch on how these costs influence project delivery timelines. The market will continue to monitor whether the current pace of absorption can be sustained amidst these rising costs. Going forward, the sustainability of this leasing trend will depend on the continued expansion of GCCs and the ability of developers to manage their project budgets. Investors should track future leasing volumes and any shifts in corporate expansion plans that might change these demand fundamentals.