In a major move marking its continued expansion in Hyderabad, Tata Consultancy Services (TCS), one of the largest IT service companies globally, has secured a significant commercial lease agreement. The company has leased a state-of-the-art building in Hyderabad’s Nanakramguda area for a monthly rent of ₹4.37 crore. This strategic move comes as part of TCS’s ongoing efforts to strengthen its office presence in one of India’s leading technology hubs.
Prime Location, Long-Term Commitment
The property, Paradigm Rajapushpa, is a Grade-A commercial building developed by the Rajapushpa Group, spanning an impressive 10.2 lakh square feet (sq ft). This expansive office space is situated in the city’s vibrant Business District, home to a thriving ecosystem of top-tier companies such as Wipro, ICICI, Infosys, and Broadridge.
The deal is a 15-year lease agreement, set to commence on October 1, 2024, and TCS has agreed to a rent of ₹43 per sq ft for the leased space. As part of the agreement, the rent will undergo a 12% escalation every three years, ensuring that the space remains a high-value asset for both TCS and the property developers over time.
Additionally, TCS has paid a hefty upfront deposit of ₹26.2 crore, which covers approximately six months’ worth of rent. This substantial deposit underscores TCS’s commitment to long-term growth in the city and the broader region, reinforcing Hyderabad’s position as a critical hub for the IT industry.
Robust Office Space Market in Hyderabad
The office real estate market in Hyderabad continues to thrive despite the potential challenges posed by a significant supply pipeline. According to industry data, the city currently holds a substantial 28 million square feet (msf) of vacant office stock, the highest among the top seven cities in India. Despite this high vacancy rate, the demand for office space in Hyderabad remains robust.
In fact, the city recorded an impressive 2.7 million square feet (msf) of absorption in Q1 2025, marking a 17% year-on-year increase. This strong demand trend, even amid rising supply, indicates that Hyderabad continues to be a favored destination for businesses seeking scalable, state-of-the-art office spaces.
Changing Dynamics: Rent and Vacancy Rates
Interestingly, the average rent in areas like Nanakramguda has remained relatively stable, hovering around ₹70 per square foot in recent months. This figure contrasts with TCS’s lease rate of ₹43 per square foot, suggesting that TCS has secured a competitive deal in a market that’s seeing both rising rents and a significant number of available spaces.
While some may view the large amount of vacant stock in Hyderabad as a sign of oversupply, experts believe that it is a reflection of the city’s rapidly growing infrastructure and ongoing development. The upcoming supply of commercial office spaces is expected to fuel even more business activity, as companies continue to invest in top-tier locations.
Looking Ahead: The Future of Hyderabad’s Office Space Market
The Hyderabad office market is poised for a dynamic future. While the city holds the highest amount of vacant stock among the top Indian cities, it also has one of the strongest pipelines for upcoming commercial properties. The market’s robust absorption rate, coupled with increasing demand for modern workspaces, suggests that these vacant spaces will eventually be filled by companies eager to establish a presence in the city.
For TCS, the decision to lease a significant portion of Paradigm Rajapushpa for its operations aligns with its ongoing growth strategy. The company’s presence in the city reinforces Hyderabad’s position as a premier IT destination. As more companies follow suit and secure office spaces, Hyderabad will continue to evolve into a major player in the global business ecosystem.
Conclusion
TCS’s recent office lease in Hyderabad highlights both the continued growth of the city’s commercial real estate market and the strong demand for office space in one of India’s leading IT hubs. With a 15-year commitment and substantial upfront deposit, TCS has firmly established its presence in Hyderabad’s rapidly evolving office landscape. As the city continues to expand, both in terms of infrastructure and business activity, the demand for prime office spaces will only intensify, shaping the future of Hyderabad’s commercial real estate sector for years to come.
