Committed occupancy levels for key real estate investment trusts exceeded 90% in FY26, with positive demand outlook, but geopolitical tensions and potential shift back to remote work could hinder leasing activity. According to Ambit Capital, Embassy Office Parks REIT sees occupancy rising to 92-93%, while Brookfield India Real Estate Trust pegs it at 96%. Mindspace Business Parks REIT anticipates reaching about 97%, excluding the Pocharam property in Hyderabad. However, the West Asia war has triggered macro-economic concerns that could be a roadblock for office leasing. As per Ambit Capital, most REITs are refraining from giving guidance on DPU (distribution per unit) growth due to the uncertain outlook.
Prime Minister Narendra Modi's work-from-home appeal faces significant resistance from India's 5.5 million IT professionals and their employers, but major corporations are already implementing changes. According to recent reports, companies that have opted for hybrid/WFH include RPG Group, PwC India, IndusInd Bank and HDFC Bank. The IT sector successfully operated remotely during COVID without major cybersecurity breaches, but the threat landscape in 2026 is substantially more complex with AI-powered cyberattacks, sophisticated phishing, ransomware-as-a-service, and nation-state intrusion campaigns all escalating dramatically. Companies that have invested in returning employees to offices face significant transition costs to reverse these investments.
Global capability centres (GCCs) have been at the helm of driving Grade-A office demand in India, but nervousness is creeping in due to the current crisis. Of the 7.1 million square feet of gross leasing by Mindspace in FY26, about 50% was to GCCs, with management noting some slowdown in decision-making owing to the war. Brookfield achieved a record 4 msf of gross leasing in FY26, with almost half from GCCs, while Embassy Office Parks had GCCs accounting for almost 60% of leasing in FY26. The Indian rupee depreciation has made the country more attractive, with Mindspace expecting leasing activity to resume soon despite current delays.
The average monthly Grade A office rental in the top seven Indian cities increased by 6% in 2025 to ₹92 per square foot and inched up to ₹93 per sq ft in Q1CY26, according to Anarock Property Consultants. Faster absorption of office units has kept rentals steady, but any further rise in the current backdrop could be slow. The rental outlook is also a function of upcoming supply of new office spaces. Embassy REIT is the only REIT to provide DPU guidance of 10% year-on-year growth for FY27, while most other REITs are refraining from giving guidance due to the uncertain environment.
Delhi has issued a comprehensive advisory mandating two-day work-from-home arrangements for private sector employees as part of the 'Mera Bharat, Mera Yogdan' fuel-saving campaign. Chief Minister Rekha Gupta launched this 90-day campaign earlier this week, stipulating that all Delhi government employees must work from home for two days per week and use public transport. The advisory specifically targets industrial establishments, factories, shops and commercial establishments in Delhi, including IT and IT Enabled Services (ITES) sectors. As reported by the labour department, employers are requested to sensitize their workforce about the national importance of fuel conservation during the current crisis and actively motivate employees to adopt fuel-saving commuting practices.
Industry executives maintain that long-term office demand continues to be anchored by workforce expansion, corporate growth, and India's rise as a global services hub. Flex leasing touched nearly 4 million square feet in the first quarter of 2026, rising 77 per cent year-on-year and accounting for roughly one-fourth of total leasing activity. IT professionals who hold expertise in cloud cost management, cybersecurity, AI productivity, and infrastructure management deliver value in both growth and austerity periods. Certifications in cloud cost management (AWS, Azure, GCP), cybersecurity (CompTIA Security+, CEH, CISSP), AI productivity tools, and project management are becoming increasingly valuable as companies navigate economic constraints while maintaining operational efficiency.
