Chennai’s Residential Sales Growth Highest Among Major Cities; Records 1.5 mn sq ft Office Leasing in Q1 2026: Knight Frank India

Chennai, April 07, 2026: Knight Frank India, a leading international property consultancy, in its latest report, India Real Estate: Office and Residential Market (January – March 2026) Q1 2026 noted that Chennai’s office market recorded leasing activity of 1.5 mn sq ft in Q1 2026, while new completions stood at 0.5 mn sq ft. Office rentals also registered an 8% YoY increase, reflecting steady occupier demand despite moderation in transaction volumes.Urban Transit

Chennai Office Market Summary (Q1 2026)
Office Transactions(Mn Sq Ft) Completions(Mn Sq Ft)
Cities Q1 2025 Q1 2026 % Change YoY Cities Q1 2025 Q1 2026 % Change YoY
Chennai 1.8 1.5 -19% Chennai 0.2 0.5 160%

Chennai’s commercial real estate market witnessed leasing activity driven primarily by Global Capability Centres (GCCs), followed by India-facing businesses and flex operators, reflecting a diversified occupier base.

End-Use Category Split (Chennai – Q1 2026)
End-User Licensee/Buyer GCC Third Party IT Flex India Facing Total
Area transacted in mn sq ft 0.7 0.0 0.36 0.4 1.5
% Share 50% 3% 24% 24%

Urban Transit
Rail Freight
Long Distance Bus & Rail

RESIDENTIAL MARKET UPDATE: JANUARY – MARCH 2026

Chennai’s residential market led all major cities in terms of growth momentum in Q1 2026, registering the highest year-on-year increase in both sales and new launches. Chennai’s residential market recorded 4,763 units sold in Q1 2026, compared to 4,357 units in Q1 2025, reflecting a 9% YoY growth. New launches stood at 5,112 units, compared to 4,576 units in Q1 2025, registering a 12% YoY increase. The city’s weighted average residential prices rose by 6% YoY, indicating steady demand momentum.Urban Transit

Residential Sales and Launches
Sales Launches
City Q1 2026 Q1 2025 YoY % Change City Q1 2026 Q1 2025 YoY % Change
Chennai 4,763 4,357 9% Chennai 5,112 4,576 12%

Rail Freight
Long Distance Bus & Rail
Urban Transit

Joseph Thilak, National Director – Occupier Strategy and Solutions (Hyderabad, Chennai and Kochi), Knight Frank India, said, “Chennai’s real estate market has demonstrated balanced performance in Q1 2026. While office leasing activity has moderated, the sharp increase in completions highlights developer confidence and a robust supply pipeline. The continued dominance of GCCs and India-facing occupiers reinforces Chennai’s position as a preferred commercial destination. On the residential side, the market has recorded healthy growth in both sales and launches, with strong traction in mid and premium segments. This reflects evolving homebuyer preferences and sustained end-user demand.”

Chennai’s residential market exhibited a clear shift in demand across ticket sizes, with traction moving away from the affordable segment toward mid and premium housing. The sub-INR 5 mn segment saw a 39% decline, indicating a relative moderation in entry-level demand. Notably, Chennai also bucked the broader trend in the mid-segment, with INR 5–10 mn sales rising 19% despite muted performance in most other cities, underscoring the city’s resilience in this category. At the higher end, demand remained robust, with the INR 10+ million segments growing steadily—particularly the INR 20–50 million bracket, which surged 52% year-on-year—pointing to rising traction in premium housing.

Ticket-Size Split of Sales – ChennaiUrban Transit
Ticket Size Categories <5 mn 5-10 mn 10-20 mn 20-50 mn 50-100 mn 100-200 mn 200-500 mn Total Q1 2026 591 2,278 1,240 557 74 21 2 4,763 Q1 2025 969 1,907 1,032 367 67 15 0 4,357 YoY % Change -39% 19% 20% 52% 10% 40% NA 9% Research