40% of India Office Occupiers Worry About Finding Quality Space Through 2028

India’s commercial real estate market is entering a new phase where the question is no longer simply about how much office space companies need, but whether the right quality of space will be available in the right location.

Nearly 40% of office occupiers in India are concerned about securing high-quality, well-located office space through 2028, according to CBRE’s 2026 India Office Occupier Survey. The finding comes at a time when companies are expanding their footprints, Global Capability Centres (GCCs) are driving demand, and businesses are increasingly prioritising workplace quality and employee experience.

For India’s commercial real estate sector, this signals an important shift. The next phase of office growth could be defined less by the availability of conventional office buildings and more by the availability of future-ready, well-connected and investment-grade workplaces.

From Risk to Reward: India’s Office Space Market

The Quality Space Crunch Is Taking Shape

India’s office market has been experiencing strong leasing momentum. JLL reported that gross office leasing reached a record 83.3 million sq. ft. in 2025, while net absorption touched an unprecedented 57 million sq. ft. The strong performance was supported by GCC expansion, flexible workspace operators and demand from sectors such as technology, manufacturing and BFSI.

However, strong demand is also creating pressure on high-quality inventory.

According to CBRE’s survey, 55% of organisations planning to relocate are specifically looking for better-quality buildings. This indicates that relocation is no longer simply a cost-management exercise. Companies are using real estate as a tool to improve employee experience, attract talent and support long-term business expansion.

The result is a potential mismatch: companies increasingly want premium office environments, while suitable supply in established business districts remains comparatively limited.

Why Established Locations Still Matter

The rise of hybrid work has changed how businesses think about offices, but it has not eliminated the importance of location.

CBRE found that 47% of respondents prefer core or established micro-markets for their new offices. Another 25% prefer a combination of core and non-core locations.

The reason goes beyond corporate prestige.

Established business districts typically offer mature infrastructure, access to large talent pools, public transport, social infrastructure and stronger connectivity. For companies competing for skilled employees, these factors can influence recruitment and retention just as much as the office itself.

This explains why lower rents in peripheral locations may not always compensate for weaker connectivity or longer commuting times.

For occupiers, the calculation is increasingly becoming:

Quality + Connectivity + Talent Access + Employee Experience = Workplace Value

Investment-Grade Buildings Gain Ground

The preference for better-quality offices is already visible in leasing activity.

During the first half of 2025-26, 41% of office leasing was concentrated in investment-grade buildings, while in core micro-markets, investment-grade assets accounted for 46% of leasing transactions. At the same time, investment-grade buildings represented 57% of new office completions during the period.

This trend suggests that developers and landlords with modern assets may be better positioned to capture future demand.

The definition of a premium office, however, is also evolving.

A modern workplace today is expected to offer more than air-conditioned floors and attractive lobbies. Companies increasingly look for energy efficiency, sustainability credentials, technology infrastructure, employee amenities, flexible layouts, wellness facilities and reliable connectivity.

JLL has previously noted that new-age buildings have been dominating office absorption in India. Between 2021 and Q1 2024, buildings completed since 2021 accounted for 94.3 million sq. ft. of cumulative net absorption across the country’s top seven office markets.

GCCs Could Intensify the Competition

One of the biggest forces behind India’s office demand is the continued expansion of Global Capability Centres.

GCCs are increasingly moving beyond traditional back-office operations and becoming hubs for technology, engineering, analytics, artificial intelligence and product development.

In 2025, GCCs accounted for 37.7% of India’s gross office leasing, with approximately 31 million sq. ft. of space absorption, according to JLL.

This expansion is significant because GCCs often have sophisticated workplace requirements.

They need buildings capable of supporting large teams, advanced technology infrastructure, collaboration spaces, security requirements and employee-focused amenities. As more global companies establish or expand their Indian operations, competition for suitable Grade A and premium office stock could become stronger.

The Office Is Becoming an Employee Experience Platform

Perhaps the most important change is cultural.

The office is no longer simply a place where employees sit and work. Companies increasingly see the workplace as a tool for collaboration, innovation, culture and employee engagement.

This is why quality matters.

A poorly connected building with outdated infrastructure may technically satisfy a company’s space requirement, but it may fail to deliver the experience employees expect.

CBRE’s findings point towards a broader workplace strategy in which flexible workspaces, commuting convenience and AI-enabled infrastructure are becoming increasingly important considerations.

For developers, this creates an opportunity to rethink commercial projects around the end user rather than merely the tenant.

What It Means for Developers and Investors

The expected shortage of quality space through 2028 could create opportunities for developers who can deliver the right product at the right locations.

CBRE has recommended that landlords and developers focus on high-quality assets and stronger connectivity. It has also highlighted the potential of upgrading ageing buildings to meet changing occupier requirements.

This is particularly relevant for India’s older commercial building stock.

Instead of replacing every ageing asset, strategic upgrades could improve energy efficiency, amenities, technology infrastructure, common areas and workplace functionality.

JLL has estimated that around 530.8 million sq. ft., or approximately 62% of Grade A office stock across India’s top seven cities, requires significant upgrades to meet future occupier and sustainability requirements.

That makes redevelopment and asset repositioning an important part of India’s next commercial real estate cycle.

Tier-II Cities Could Become the Next Opportunity

The quality-space challenge is not necessarily limited to India’s established metros.

As businesses search for talent, operational efficiency and geographic diversification, selected Tier-II cities could attract a greater share of commercial real estate investment.

CBRE has specifically recommended developing quality office space in select Tier-II cities to capture emerging occupier demand.

Cities that combine skilled talent, improving infrastructure, connectivity and relatively competitive operating costs could benefit from this transition.

For developers, the opportunity lies in identifying locations where demand is developing before the supply pipeline becomes crowded.

What Should Occupiers Do?

For businesses planning expansion or relocation, the message from the survey is straightforward: waiting until the last minute could become expensive.

If nearly 40% of occupiers already expect difficulty securing quality space through 2028, companies with predictable expansion plans should begin evaluating their requirements early.

This means assessing:

• Future employee headcount
• Required office size
• Preferred micro-markets
• Employee commute patterns
• Technology and AI infrastructure
• Sustainability requirements
• Flexibility for future expansion
• Building quality and amenities

Early planning could allow companies to secure better buildings, negotiate more effectively and avoid being forced into locations that do not match their long-term workplace strategy.

The Bigger Picture

India’s office market is not showing signs of simply returning to the pre-pandemic model. Instead, it is moving towards a more selective and experience-driven ecosystem.

Demand is rising, but occupiers are becoming more discerning about what they lease.

The 40% concern highlighted by CBRE is therefore more than a statistic. It reflects the growing gap between the quantity of office space available and the quality of space businesses increasingly expect.

With record leasing activity, expanding GCCs, stronger demand for investment-grade assets and an increasing focus on employee experience, India’s commercial real estate market could enter a period where quality becomes the new competitive advantage.

For developers, that means building better. For landlords, it means upgrading smarter. For investors, it means identifying assets capable of remaining relevant through 2028 and beyond.

And for occupiers, it means one thing above all: the best office spaces may need to be secured well before they are actually needed.

99Realty Takeaway

India’s commercial real estate story is shifting from “How much office space do we have?” to “Do we have the right office space?”

As companies expand and workplace expectations evolve, quality, location, connectivity and employee experience are likely to become the defining factors shaping India’s office market over the next few years.