Hyderabad office leasing hits all-time high in 2025; luxury homes see 71% of sales: Knight Frank

Hyderabad: Hyderabad saw the highest-ever annual office leasing at 11.4 million square feet, along with 71 per cent of sales in luxury homes in the second half of 2025.

The city also saw a 40 per cent increase in new Global Capability Centres (GCCs) recently, making it the second most sought-after city in India. Bengaluru remains the top in South India.

Role of GCCs in expanding offices spaces in South India

GCCs have fuelled the growth of office space in South India, surpassing Bengaluru’s 33 per cent.

This new wave of high-income offices has also fuelled the demand for high-income luxury residential homes. The impact is that GCCs account for 50 per cent of all leasing activity in the city.

Major global players, including Goldman Sachs, Warner Bros. Discovery and ServiceNow, have anchored significant transactions, reinforcing Hyderabad’s status as a global hub for high-value operations.

This demand has pushed average office rents up by 10 per cent to Rs 77 per sqft per month, particularly in established districts like HITEC City and the Financial District.

High-income offices increase demand for luxury homes

Luxury homes have seen a staggering 71 per cent of sales in Hyderabad in the second half of 2025, according to a report by Knight Frank India.

Homes priced above Rs 1 crore are sought after more in the market than those in the range of Rs 50 lakh, according to the report.

Hyderabad has solidified its position as a high-growth market, characterised by a decisive shift toward premium and luxury housing. While Bengaluru maintains the highest total volume of sales, Hyderabad is outpacing it in price appreciation and liveability metrics.

Key performance indicators of Hyderabad

1. Sales growth: Residential sales in Hyderabad grew by 4 per cent in 2025, reaching 38,403 units, while Bengaluru’s sales remained flat (0% growth).

2. Price appreciation: Hyderabad saw a 13 per cent rise in average property prices in 2025, with weighted average prices reaching approximately Rs 6,721 per sqft.

3. Inventory efficiency: Hyderabad recorded a marginal 2 per cent decline in unsold stock due to restricted new supply, whereas Bengaluru saw a 23 per cent jump in unsold inventory.

4. Luxury dominance: High-value homes (priced above Rs 1 crore) now drive the market, accounting for nearly 50 per cent of the total transaction value.

Key findings from the residential sector include:

The rise of high-value segments: Sales for homes in the Rs 2 crore to Rs 5 crore category saw a sharp jump, moving from a 13 per cent share in 2024 to 22 per cent in late 2025.

Ultra-luxury velocity: The most elite segment—homes priced between Rs 10 crore and Rs 20 crore—recorded the fastest turnover, with a Quarters-to-Sell (QTS) rate of just 1.1 quarters.

Price appreciation: Average residential prices climbed 13 per cent to reach Rs 6,721 per sq ft, as developers prioritise high-demand prime corridors.

Fading affordability: In contrast, the market for affordable housing continues to shrink; homes priced below Rs 50 lakh now account for only 4 per cent of total sales.

Office Market: A global strategic hub

Fuelling this residential boom is a robust office market that hit near-record highs in 2025. Annual leasing transactions reached 11.4 million sqft, the second-highest volume in the city’s history.

Infrastructure:

Outer Ring Road and Regional Ring Road in the peripheral areas of Kokapet and Tellapur make the IT hub more accessible compared to the congested corridors of Whitefield or Sarjapur in Bengaluru.

The cost of living and maintaining a comparable lifestyle is approximately 12 per cent cheaper in Hyderabad than Bengaluru, making it a preferred choice for tech professionals seeking a better quality of life, says the report.

The emerging hotspots of Hyderabad:

1) West Hyderabad: Kokapet, Gachibowli and Tellapur for premium and luxury homes

2) North Hyderabad: Kompally and Medchal for mid-segment growth

3) South and East Hyderabad: Adibatla and Uppal to see major infrastructure-led expansion

District growth:

Medchal-Malkajgiri and Rangareddy lead in volume but Sangareddy has emerged as a dark horse with a 21 per cent increase in property values, driven by proximity to the upcoming Regional Ring Road.

The report states that proactive government measures and clear land approvals through TS-iPass have helped. There is also a strong capital appreciation of 13 per cent combined with steady rental growth, which is driving the market.