Bengaluru Emerges as India’s Key Economic and Real Estate Hub

Bengaluru has firmly established itself as one of India’s top economic and real estate powerhouses, according to the latest India Prime Index report by Knight Frank. The city ranks second overall, closely trailing Hyderabad, and has displayed stellar performance across both socio-economic parameters and the real estate market.

The city’s workforce participation rate is the highest among India’s top metros, contributing to Bengaluru’s recognition as a major economic driver. Moreover, Bengaluru also boasts the lowest unemployment rate among the six cities analysed in the report. These economic strengths are mirrored in the city’s residential real estate sector, where the market continues to show impressive growth. In 2023, Bengaluru achieved a nine-year high with residential sales reaching 54,046 units—a testament to the city’s strong housing demand and investment appeal.

Bengaluru is also a dominant force in India’s office market, accounting for 21% of the total commercial transactions in major cities. The city’s commercial real estate sector has seen significant growth, with 66.3 million square feet of new office space added between 2019 and 2023—the highest in the country. Office leasing volumes for 2023 have exceeded the 10-year average, with Bengaluru recording 12.5 million square feet of leasing activity, underlining its status as a hub for corporate expansion. Bengaluru continues to thrive as India’s IT services leader, with an impressive 24.17 million square feet of IT services transactions. This highlights the city’s unshakable grip on the technology sector, which remains a key pillar of its economy.

Despite challenges related to governance and urban planning that affect public services, Bengaluru remains an attractive destination for talent and investments. The city’s diversified economy, which spans IT, education, research, and consulting, continues to draw multinational corporations and domestic enterprises alike. As the city capitalises on its dynamic service sector, young and skilled workforce, and entrepreneurial spirit, Bengaluru is well-positioned for sustained growth. While Hyderabad is emerging as a strong competitor, Bengaluru’s status as India’s economic and real estate epicentre remains unparalleled, setting the benchmark for other cities to follow.