Hyderabad has emerged as one of the fastest growing real estate markets in India, according to the Indian Real Estate Report released by Crisil, which said that 2024 was one of the best years for the sector post-COVID.
The report highlighted that Hyderabad’s retail real estate market witnessed strong growth in 2024, with nearly 1.8 million square feet of retail space absorbed, which is one of the best years for the sector post-COVID. Key leasing transactions occurred in areas such as Banjara Hills, Jubilee Hills, Secunderabad, Madhapur, Manikonda, and Kondapur.
The city witnessed an absorption of approximately 12.5 million square feet of office space in 2024, accounting for 19% of the total 66.4 million square feet of Grade A space leased across the country.
Commercial real estate
As per the report, the Information Technology – Business Process Management (IT-BPM) sector remained the largest occupier of office space in Hyderabad, accounting for 33% of the total Grade A office space leased. The healthcare and pharma industries followed closely, occupying 16%, while flexible office space providers took up 14%.
The city saw 8.2 million square feet of new office supply in 2024, while the average transacted rent increased by 4% to ₹68 per square feet per month. The prime business hubs of Madhapur and Raidurg continued to dominate the leasing market, accounting for 75% of the total activity, followed by Gachibowli at 20%. The office space vacancy rate stood at 15%, reflecting strong leasing momentum.
Warehousing and industrial expansion
In terms of warehousing, Hyderabad has emerged as one of the top five markets in India, recording transactions totalling 2.15 million square feet in 2024. Large-sized deals exceeding one lakh square feet dominated the market, comprising nearly 60% of total transactions.
Medchal and Shamshabad remained the primary industrial and warehousing hubs, while Warangal Road and Uppal gained traction as emerging sub-markets. The sector witnessed 5 to 7% year-on-year growth, with micro-markets like Kothur and Patancheru seeing notable activity. The demand for warehousing space is expected to accelerate in 2025, driven by increased requirements from e-commerce, FMCG, and logistics companies along Hyderabad’s northern and southern corridors, the report said.
Land prices across all sub-markets recorded significant growth, with an annual increase of 10 to 12%. Locations along the Outer Ring Road (ORR) saw an even sharper rise of 15-25% over the past few years, fuelled by sustained demand from industrial and logistics players, as per the report.
Published – February 08, 2025 08:34 pm IST
