Leasing activity in Q4 hits a nine-quarter high of 4.15 million sq ft

• Hyderabad saw gross leasing of 4.15 million sq ft in Q4 2025, up 41.0% q-o-q. Leasing activity in Q4 was dominated by BFSI, with a 36.7% share, followed by IT & ITeS and the Healthcare‑biotech sector, with 17.5% and 16.6% shares respectively.
• Net absorption was also up 66.7% q-o-q, standing at 2.69 million sq ft, with Gachibowli holding the largest share at 50.9%, followed by Hitec City at 46.2%. Annual net absorption reached 8.14 million sq ft, up 11.3% y-o-y.

New supply additions driven by Gachibowli and Hitec City submarkets

• With two new completions, one each in Hitec City and Gachibowli, adding 3.40 million sq ft of new supply, and the addition of a refurbished project in the CBD, the city’s operational Grade A office stock rose to 143.4 million sq ft.
• Overall vacancy dropped 10 bps to 25.7% in Q4, driven by strong leasing across submarkets, with the CBD and Gachibowli experiencing the largest q-o-q decline in vacancy.

Premium quality office projects driving rental growth across submarkets

• Overall rents rose 2.7% q-o-q and 15.4% y-o-y to INR 71.8 per sq ft per month in Q4 2025, with stronger q-o-q growth recorded in Hitec City (3.1%) and Gachibowli (2.3%).
• Capital values at the overall city level kept pace with rents, with yields across submarkets witnessing a marginal drop of 5–10 bps.

Outlook: Sustained demand in prime corridors to keep vacancy levels range-bound

• An annual supply of 15–16 million sq ft is anticipated in the near future, driven by Gachibowli, which is also facing potential oversupply. Hitec City is likely to maintain lower vacancy, supported by stronger tenant demand in the near term.
• Robust market activity is expected, with strong demand across occupier categories, including GCCs in IT/ITeS, BFSI, manufacturing and healthcare, as well as flexible workspace operators and other domestic occupiers.