In a significant boost to Hyderabad’s Grade-A office market, Microsoft India R&D has leased 2.65 lakh square feet at Phoenix Centaurus in Gachibowli, covering the 3rd and 4th floors. The five-year sub-lease with Tablespace Technologies commands a monthly rent of Rs 5.4 crore, according to documents accessed by Propstack. The sub-lease commenced in July 2025, translating to a monthly rate of Rs 204 per square foot.
The lease structure includes a base rent of Rs 67 per sq ft, along with common area maintenance (CAM) charges, operating expenses, capital expenses, and management fees. An annual escalation of 4.8% has been agreed upon, with a security deposit of Rs 42.15 crore. Microsoft has already paid Rs 92.94 lakh as stamp duty and registration charges for the deal. Tablespace Technologies, a managed office space operator, is the sub-lessor and has its own lease with Phoenix Tech Zone.
Hyderabad’s Growing Appeal for Tech Majors
The deal underscores Hyderabad’s reputation as one of India’s most resilient office markets, attracting technology, financial services, and global capability centres (GCCs). Knight Frank India reported that Hyderabad witnessed gross leasing of nearly 10 million sq ft in FY24, with tech giants driving most of the activity. Industry experts say Microsoft’s expansion reflects confidence in the city’s infrastructure, skilled talent pool, and competitive costs.
“Deals of this nature highlight a strong absorption pipeline, which supports rental stability despite rising supply,” noted real estate analysts.
Microsoft’s Growing India Presence
Microsoft has been steadily expanding its real estate footprint across India, with major operations in Bengaluru, Hyderabad, Noida, and Pune. The new Hyderabad lease adds to its growing presence in the country and strengthens its R&D operations.
Other Big-Ticket Leases in Hyderabad
The city has witnessed multiple high-value office leases in recent years. In 2024, Tata Consultancy Services (TCS) leased 10.18 lakh sq ft in the Serlingampally Mandal for a monthly rent of Rs 4.3 crore. Similarly, Facebook renewed its Hyderabad lease for 3.7 lakh sq ft across two transactions totaling Rs 2.8 crore per month.
Microsoft’s move is expected to further cement Hyderabad’s status as a preferred destination for multinational tech firms seeking scalable operations in India.