Why Kolkata landlords are raising rents even as office deals slow down

Kolkata’s office landlords have pushed rents up by double digits even as the volume of leasing deals fell sharply, a combination that analysts attribute to record-low vacancy and a shortage of new supply.

Average office rentals across the city rose 15% year-on-year in the first half of 2026 to Rs 51.1 per sq ft per month, even as overall transactions dropped 26% to 8 lakh sq ft compared with the same period last year, which had followed an exceptional leasing year in 2025. Vacancy fell to 27.5%, its lowest recorded level, aided by the absence of new office completions during the period.

Salt Lake City and Rajarhat New Town, which together made up nearly 94% of total office transactions, saw the steepest rental increases — 17% and 27% respectively — while the CBD and Off-CBD markets rose 13% to Rs 82-Rs 115 per sq ft.

“Following the exceptional leasing activity of 2025, Kolkata’s office market experienced a phase of consolidation. While overall transaction volumes moderated due to the absence of large-sized deals, occupier demand remained resilient across the city’s key business districts,” said Joydeep Paul, senior director at Knight Frank India.