India's Organised Office Market Expansion Creates Acquisition Opportunities for REITs
Quick Look
- India has approximately 854 million square feet of organised office stock, with nearly 620 million square feet held by developers and high-net-worth individuals, including 307 million square feet of Grade A non-strata space that could be acquired by REITs.
- REITs' office holdings have grown from 71.8 million square feet in 2021 to 163 million square feet in Q1 2026, increasing their share of total office stock from 11.2% to 19%.
- REIT market capitalisation has more than tripled since FY22 to Rs 2.03 lakh crore, and unitholders have increased nearly five-fold to 3.7 lakh.
AI-generated summary
Why It Matters
India's organised office market has been growing steadily, with REITs increasing their presence since their introduction. The Equirus Securities report provides current market data on office stock holdings and acquisition potential.
India has around 854 million square feet of organised office stock. ANI
More than 300 million square feet of office space held by developers and high-net-worth individuals could provide a fresh acquisition opportunity for Real Estate Investment Trusts (REITs), as India’s organised office market continues to expand. According to an Equirus Securities report, India has around 854 million square feet of organised office stock, of which nearly 620 million square feet is held by developers and HNIs. About 307 million square feet of this is Grade A, non-strata office stock that could potentially be acquired by REITs. The report said the available inventory could allow REITs to acquire both stabilised assets that generate immediate income and assets nearing completion that can support future portfolio growth. Large assets of 5-10 million square feet or more could also provide opportunities for sizeable single transactions. Equirus expects office rental growth between 2025 and 2027 to range from 2.9 percent in Hyderabad to 5.3 percent in Bengaluru. REITs have already expanded their presence significantly in India's office market. Office stock under REITs has increased to around 163 million square feet in the first quarter of 2026 from 71.8 million square feet in 2021. Their share of total office stock has consequently risen to about 19 percent from 11.2 percent during the period. REIT market capitalisation has more than tripled since FY22 to Rs 2.03 lakh crore, while the number of unitholders has increased nearly five-fold to 3.7 lakh, ANI reported. Bengaluru remains the largest market for listed Indian office REITs, accounting for around Rs 1.3 lakh crore, or 46 percent, of the roughly Rs 2.8 lakh crore gross asset value of listed office REITs, according to the Equirus report. The growing pool of Grade A developer-owned office assets gives REITs a sizeable pipeline for acquisitions, while the expected rental growth across major markets could further support the expansion of their portfolios.
What to Watch
AI outlook — possibilities, not facts
REITs will acquire a portion of the 307 million square feet of Grade A non-strata office stock held by developers and HNIs
Likely · Within months
Office rental growth in Bengaluru will reach 5.3 percent annually between 2025 and 2027
Possible · Within years
Open Questions
- What specific regulatory changes might facilitate REIT acquisitions of developer-held office assets?
- How will interest rate trends affect REIT financing costs for future acquisitions?
- Which specific developers or HNIs hold the 307 million square feet of Grade A non-strata office stock mentioned in the report?
