Amidst a year of global uncertainty, India’s economy has emerged as a resilient outlier, with the Reserve Bank of India revising its GDP growth estimate for FY 2026 upward to 7.3%. This macro-economic stability has provided a strong foundation for both the residential and commercial sectors to thrive. According to the Knight Frank’s Report on India’s Real Estate H2 2025, Nationally, the office market scaled new peaks with record leasing volumes of 86.4 mn sq ft, while the residential market has undergone a structural shift toward premiumization, with homes priced above ₹10 mn now accounting for 50% of all annual sales across major cities.
Bengaluru’s Real Estate Market Growth H2 (Jul-Dec) 2025
Bengaluru’s Office Market
Bengaluru continues to be the primary engine of India’s commercial real estate sector, accounting for approximately 33% of the country’s total office leasing activity in 2025.
- Unprecedented Leasing Volumes: The city recorded an extraordinary annual transaction volume of 2.67 mn sq m (28.7 mn sq ft), which is 58% higher than the previous record set in 2024.
- The Rise of Pre-commitments: A defining feature of the market was the high level of pre-commitments, accounting for 43% of the total annual volume (1.2 mn sq m or 12.4 mn sq ft) as occupiers secured space ahead of delivery due to supply constraints.
- GCC and IT Dominance: Global Capability Centres (GCCs) remained the largest demand driver, representing 50% of the transacted volume in H2 2025 and a massive 62% share of all pre-commitments. Third-party IT services also saw a revival, highlighted by a 1.75 mn sq ft pre-commitment by TCS in West Bengaluru.
- Rental Growth and Corridors: Average transacted rents rose by 6% YoY to ₹1,046 per sq m (₹97.1 per sq ft). The Outer Ring Road (ORR) remained the most active corridor with a 44% share of H2 transactions, while East (Whitefield) followed with a 29% share.
Bengaluru’s Residential Market
The second half of 2025 marked a pivotal structural transformation in Bengaluru’s residential market, characterized by record development activity and a decisive move toward higher-value housing.
- Record-Breaking Launches: The city saw 35,262 units launched in H2 2025, the highest ever recorded for any H2 period. On an annual basis, launches increased by 23% YoY to 68,760 units, while annual sales remained stable at 55,373 units.
- Structural Pivot to Premium: There is a clear shift toward larger, amenity-rich homes. The average unit size of new launches increased by 7% YoY, and the ₹10–50 mn segment has emerged as the primary growth driver for both supply and absorption. Conversely, the sub ₹10 mn segment is steadily losing its market relevance as buyer preferences evolve.
- Emergence of the North: In a historic shift, North Bengaluru (Hebbal, Thanisandra, Devanahalli, IVC Road) overtook East Bengaluru for the first time, accounting for 34% of launches and 33% of sales. This was driven by infrastructure projects like the upcoming Blue Line Metro and growth near the international airport.
- South Bengaluru Resilience: South Bengaluru (Sarjapur Road, Bannerghatta Road) retained its overall dominance in launches (34%) and maintained a strong sales share (32%), bolstered by the inauguration of the Yellow Line Metro.
- Inventory Health: Total unsold inventory rose 25% YoY to 67,518 units. However, the market health is highly bifurcated: the premium ₹10–50 mn segment maintains a healthy Quarters-to-Sell (QTS) of 2.9 to 3.1, indicating high demand velocity. In contrast, the sub ₹5 mn segment faces significant stress with a QTS of 20.3 quarters.
- Pricing Trends: The city’s weighted average capital value appreciated by 12% YoY to ₹79,524 per sq m (₹7,388 per sq ft). This rise was largely pushed by the increased volume of high-ticket project launches rather than uniform appreciation across all segments.
- Stabilization in the East: Long the city’s powerhouse, East Bengaluru (Whitefield) saw its relative share of launches dip slightly to 27%. This is viewed as a phase of stabilization following hyper-growth in previous years, with future demand expected to move toward peripheral pockets like Hoskote.
Data Source: Knight Frank’s Report on India’s Real Estate H2 2025
