‘Startup City’ Bengaluru matches Tokyo on office rents as ‘Maximum City’ Mumbai leasing surpasses 2025 record: Survey
Bengaluru, India’s ‘Startup City’, is keeping pace with Tokyo in prime office rental growth, while Mumbai’s commercial property market is witnessing a sharp revival in leasing activity, highlighting contrasting trends across the country’s major business hubs.
According to Knight Frank’s latest Asia-Pacific Research: Office Markets – Q3 2026 report, Bengaluru recorded an 11.5% year-on-year (YoY) increase in prime office rents during the July-September quarter, matching Tokyo’s growth rate. Bengaluru ranked fourth among 24 Asia-Pacific markets, while Tokyo took the third position.
Mumbai, meanwhile, recorded a 33% YoY increase in office leasing transactions in Q3 2026. The city’s year-to-date (YTD) leasing volumes have already surpassed its full-year total for 2025, with India-focused occupiers accounting for more than half of the quarterly leasing activity.
Bengaluru matches Tokyo in office rental growth
Bengaluru’s prime office rents increased 2.8% quarter-on-quarter (QoQ) to ₹2,015 per sq ft per annum in Q3 2026. The city continued to benefit from demand from global capability centres (GCCs), which accounted for nearly 50% of its office leasing demand.
Despite a significant increase in new office completions, vacancy levels remained relatively stable at 13.4%, indicating that occupier demand continued to absorb additional supply.
Across the Asia-Pacific region, Hong Kong SAR recorded the highest annual rental growth at 17.1%, followed by Brisbane at 12.1%. Tokyo and Bengaluru both recorded 11.5% growth.
Mumbai office leasing transactions jump 33%
Mumbai’s office market recorded a different trend, with leasing transactions rising 33% annually. Prime office rents in the city increased 4% YoY and 2% QoQ to ₹4,111 per sq ft per annum. Vacancy stood at 15.2%.
Knight Frank said India-focused occupiers contributed more than half of Mumbai’s quarterly leasing activity, with YTD volumes already exceeding the city’s full-year 2025 total.
What about Delhi-NCR?
Delhi-NCR recorded 5.4% annual growth in prime office rents, while rents remained unchanged sequentially at ₹4,428 per sq ft per annum. Its vacancy rate stood at 14.5%.
The region ranked eighth among APAC markets for rental growth. It also ranked seventh in the region by prime office occupancy cost, at $73.11 per sq ft per annum.
India’s office leasing market sees mixed trends
Office leasing across Bengaluru, Mumbai and Delhi-NCR totalled 7.6 million sq ft in Q3 2026, declining 13.6% YoY. However, prime rents across the three markets increased by an average 7.5% annually.
Knight Frank attributed demand primarily to GCCs, flexible workspace operators and domestic occupiers, which helped offset weaker activity from third-party IT services firms.
The report expects leasing activity across the three Indian markets to remain broadly in line with the record levels seen in 2025.
