+
Vestian reports 36% drop in construction activity in Q1
Real Estate

Vestian reports 36% drop in construction activity in Q1

Vestian reported a 36 per cent quarter-on-quarter decline in new office completions to 9.7 million sq ft in Q1 2026, marking the lowest level in the past four quarters amid the West Asia crisis.
The slowdown was led by cities such as Bengaluru, Hyderabad and Mumbai, where developers adopted a cautious approach. Hyderabad saw the steepest drop, with completions falling 95 per cent to 0.3 million sq ft from 6.0 million sq ft in the previous quarter.
Despite constrained supply, office absorption rose 20 per cent year-on-year to 21.53 million sq ft, driven by sustained demand from global capability centres and India’s attractiveness as a business hub.
The divergence between demand and supply led to tightening vacancies, with pan-India vacancy levels improving to 9.5 per cent from 10.8 per cent in the previous quarter. Rentals continued to rise, indicating a shift towards a landlord-driven market, particularly in prime locations.
Commenting on the trend, Shrinivas Rao, CEO, Vestian, said, “India’s office market exhibited resilience… robust absorption has tightened vacancies and driven rental appreciation.”
City-wise, Bengaluru led leasing activity, while Pune recorded its highest-ever quarterly absorption. Mumbai remained the costliest office market, and Chennai saw a sharp rise in completions due to a low base effect.
The report highlights a market recalibration, with cautious supply amid geopolitical uncertainties and sustained demand expected to drive the next phase of growth.

Vestian reported a 36 per cent quarter-on-quarter decline in new office completions to 9.7 million sq ft in Q1 2026, marking the lowest level in the past four quarters amid the West Asia crisis.The slowdown was led by cities such as Bengaluru, Hyderabad and Mumbai, where developers adopted a cautious approach. Hyderabad saw the steepest drop, with completions falling 95 per cent to 0.3 million sq ft from 6.0 million sq ft in the previous quarter.Despite constrained supply, office absorption rose 20 per cent year-on-year to 21.53 million sq ft, driven by sustained demand from global capability centres and India’s attractiveness as a business hub.The divergence between demand and supply led to tightening vacancies, with pan-India vacancy levels improving to 9.5 per cent from 10.8 per cent in the previous quarter. Rentals continued to rise, indicating a shift towards a landlord-driven market, particularly in prime locations.Commenting on the trend, Shrinivas Rao, CEO, Vestian, said, “India’s office market exhibited resilience… robust absorption has tightened vacancies and driven rental appreciation.”City-wise, Bengaluru led leasing activity, while Pune recorded its highest-ever quarterly absorption. Mumbai remained the costliest office market, and Chennai saw a sharp rise in completions due to a low base effect.The report highlights a market recalibration, with cautious supply amid geopolitical uncertainties and sustained demand expected to drive the next phase of growth.

Related Stories

Gold Stories

Next Story
Infrastructure Urban

KONE Opens India's First Digital Experience Centre in Pune

KONE, a global elevator and escalator manufacturer, has inaugurated its first Digital Experience Centre (DEC) in India, located in Pune. The facility aims to showcase how artificial intelligence (AI), connectivity and data-driven technologies can enhance customer experiences and improve building operations.The centre was inaugurated by Jussi Herlin, Executive Vice Chair, KONE Corporation; Philippe Delorme, President and CEO, KONE; and Nandan Nilekani, Co-founder and Chairman of the Board, Infosys.Designed as an interactive customer environment, the facility demonstrates digital solutions cover..

Next Story
Infrastructure Urban

CII GreenCo Launches Circularity Guidelines for Indian Industry

The Confederation of Indian Industry (CII) GreenCo Council has launched the CII GreenCo Circularity Guidelines – Pilot Version at the 17th CII GreenCo Waste & Resource Management Summit 2026 in Chennai. The initiative aims to strengthen resource efficiency, waste reduction and circular economy practices across Indian manufacturing and process industries.The guidelines introduce a structured framework with circularity indices covering raw materials, consumables, packaging and other resource inputs. These indicators will help industries assess existing practices, identify opportunities to ..

Next Story
Infrastructure Energy

Global Electronics Association Launches IPC-1783-CO2E Standard

The Global Electronics Association has introduced IPC-1783-CO2E, a new international standard aimed at improving consistency, transparency and comparability in product carbon footprint reporting across the electronics manufacturing industry.The standard, titled International Standard for Data Collection and Reporting of CO2 Equivalent (CO2e) Emissions for the Electronics Manufacturing Supply Chain, provides industry-specific guidance for collecting, estimating and reporting carbon emissions data.With increasing regulatory requirements and customer expectations, electronics manufacturers face c..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

SPECIAL OFFER
QR Code