NCR’s Commercial Rental Market Emerges as Hotspot for Investors

New Delhi, January 24, 2025: The National Capital Region has emerged as a dynamic commercial real estate hub, and it continues to attract both domestic and global investors. With its strong infrastructure, exponentially growing economy, and ever-expanding corporate footprint, Delhi-NCR has solidified its position as a sought-after investment hotspot. This growth trajectory is fueled by its strategic location, unparalleled connectivity, and status as a hub for multinational corporations, IT/ITES firms, and startups.

According to Knight Frank’s Asia-Pacific Prime Office Rental Index, Delhi-NCR has earned the distinction of being the 6th most expensive office space rental market in the Asia-Pacific (APAC) region, underscoring its global appeal and competitiveness. The region registered its potential highlighting its significance as a high-potential market for investors seeking strong returns in the commercial rental segment. The rental growth in the office space market in Delhi-NCR is attributed to various factors such as economic growth, urbanization, demographic trends, and business ecosystem.

Moreover, with NCR serving as a strategic business hub, the demand for premium-grade office spaces has grown exponentially, particularly in areas offering superior infrastructure and connectivity. As organizations prioritize workplace experiences, Grade A office spaces equipped with modern amenities have become a top choice for occupiers. As per JLL, the region achieved 9.4 million sq ft of net absorption for the year, with Q4 alone accounting for 2.9 million sq. ft., emerging as a major contributor to India’s surging office real estate market.

Mohit Goel, Managing Director, Omaxe Group says “The office space rental growth of key business markets reflects strengthened positive sentiments prevailing. Delhi-NCR witnessed a steady rental growth of 2-7 percent q-o-q in Q4 2024. The growth trend is attributed to various factors like urbanization, demographic trends, infrastructure development, and the evolving business landscape. Besides the established business hubs in the NCR market, the interesting trend is to watch out for the growing demand and high leasing activity in the Faridabad region. Once known for its industrial base, the city is rapidly transforming into a key destination for business hub and commercial space investment. The rapid advancements in the city’s infrastructure, enhanced connectivity, economic potential, and supply of Grade A office spaces make it a rising commercial hub for businesses and investors. The development of high-quality commercial assets in the region will further propel the office space market growth in Faridabad.”

Uddhav Poddar, CMD, Bhumika Group, says, “NCR’s commercial rental market is transforming, with a surge in demand for mixed-use commercial spaces and hypermarkets. As businesses seek modern, sustainable environments to meet evolving consumer and operational needs, NCR positions itself as a prime investment destination. Thus, we expect the region to continue offering strong economic fundamentals, superior connectivity, and robust growth potential to make it a favorable market for diverse commercial real estate developments.”

The key driver of NCR’s commercial real estate market is the consistently rising rental yields across prime locations such as Gurugram, Noida, Faridabad, and Delhi. Simultaneously, low vacancy rates in these areas signal strong leasing activity and a growing appetite for office space. This combination of increasing rents and steady occupancy highlights the market’s lucrative potential for investors seeking stable, high-return opportunities in commercial real estate.

Harpreet Singh Hora, Director, Reach Group, shares, “The commercial real estate market in NCR is witnessing robust growth, fueled by evolving investor preferences and occupier demand for modern, sustainable spaces. Investors are strategically diversifying into high-performing commercial assets, recognizing their potential for stable returns and capital appreciation. On the other hand, occupiers are increasingly prioritizing wellness-focused, tech-enabled office environments that align with ESG (Environmental, Social, and Governance) goals. This dual momentum underscores a paradigm shift towards long-term, value-driven investments, positioning NCR as a key hub in India’s thriving commercial real estate sector.”

Furthermore, the development of metro networks, expressways like the Dwarka Expressway, Noida-Greater Noida Expressway, and Yamuna Expressway, and the upcoming RRTS connectivity are enhancing accessibility and fostering business expansion across the region. Additionally, regions like Noida and Greater Noida are witnessing a boom in premium-grade office spaces, attracting businesses looking for high-quality properties at competitive prices. This growth allows investors to remain positive and diversify their portfolios to include commercial rentals and draw predictable returns and long-term appreciation.

Ashwani Kumar, Pyramid Infratech, says, “Gurugram has consistently attracted attention for its rapid growth in the office space segment, making it one of the leading commercial real estate destinations in NCR. The city’s well-established corporate ecosystem, combined with an increasing demand for high-quality office spaces, continues to drive its success. Gurugram’s office market is seeing a surge in demand for Grade A properties, further supported by excellent connectivity, enhancing the city’s appeal for both investors and occupiers. As the city continues with its growth trajectory, we anticipate further growth in office space demand, reinforcing Gurugram’s dominance in the commercial real estate market.”

Therefore, with its strong infrastructure, favorable market dynamics, and rising demand for high-quality office spaces, the NCR region not only offers significant growth potential but also provides investors with an opportunity to capitalize on emerging trends. By acting on these trends, investors can unlock substantial returns and secure a prominent position in one of the most promising markets in the APAC region.

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