Kolkata office leasing crosses decade milestone in 2025 as demand surges: Report

Kolkata’s office real estate market delivered its strongest performance in over a decade in 2025, with annual leasing volumes rising 69 per cent year-on-year to 2.3 million sq ft, according to a report by Knight Frank India released on Wednesday.

This marked the first time the city’s office sector crossed the 2 million sq ft leasing threshold, the report said.

The report, India Real Estate: Office and Residential Market, July-December 2025, noted that office transactions during the second half of 2025 jumped 78 per cent on-year to 1.2 million sq ft.

Average office rents in the city increased 16 per cent year-on-year to Rs 47.5 per sq ft per month, the highest rental growth recorded among India’s eight major office markets, it said.

In the residential segment, Kolkata recorded sales of 8,806 units in the second half of 2025, reflecting a 7 per cent year-on-year increase. However, full-year residential sales for 2025 declined marginally by 3 per cent to 16,896 units.

Developer sentiment showed a notable improvement, with new residential launches rebounding 38 per cent year-on-year in H2 2025 to 8,098 units, the report stated.

Kolkata remained the second most affordable residential market among the eight key Indian cities tracked, with an average price of Rs 4,037 per sq ft. Residential prices in the city rose 6 per cent year-on-year.

“The H2 office market in Kolkata is a wonderful success story with record growth in the region,” said Joydeep Paul, Senior Director – Occupier Strategy and Solutions, Kolkata, Knight Frank India.

He added that the metropolis has managed to stay steady and remain affordable for homebuyers, positioning Kolkata as a sustainable, value-driven market over the long term.

The report also highlighted that unsold residential inventory in the city declined 5 per cent year-on-year to 19,630 units, the lowest level recorded in a decade.

Market fundamentals were further tightened by the continued absence of new office supply in 2025, leading to a sharp fall in vacancy levels to 29.9 per cent, it said.