‘Cannot ignore job loss risks from AI’: Knight Frank’s Gulam Zia urges caution on office demand

Gulam Zia, Senior Executive Director at Knight Frank India

• AI-driven job losses may affect future office real estate demand
• Office leasing impact from current disruptions seen in Q3 or Q4
• India's housing market to grow 7-8% annually

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Gulam Zia, Senior Executive Director at Knight Frank India, said the potential impact of artificial intelligence on employment cannot be ignored, cautioning that job losses linked to AI could influence future demand for office real estate.

Speaking at the Moneycontrol Global Wealth Summit, Zia said, “Cannot ignore job losses impact because of AI, we have to be cautious,” highlighting concerns about how technological disruption could reshape workforce dynamics and corporate space requirements over time.

At the same time, he noted that the immediate impact on office leasing may not be visible yet because most transactions recorded this year were initiated several quarters earlier.

“Most of the transactions in the first quarter of 2026 began three to four quarters earlier. So whatever happens in Q1 is not something that started on January 1,” he said.

According to Zia, the real impact of current economic uncertainties and market disruptions is likely to be reflected later in the year.

“Whatever is happening now, the impact will probably be seen in Q3 or Q4,” he said, adding that the second quarter may still benefit from momentum built during the strong performance of the previous year.

India’s office leasing market recorded about 85 million square feet of transactions in 2025, marking a nearly 20 percent year-on-year growth despite global uncertainties, he noted.

However, Zia said some early signs of caution are already emerging in the market, with companies taking longer than usual to finalise office real estate transactions.

“Slowdowns are already being seen. A lot of people are taking a little more time than they would have taken otherwise,” he said.

Beyond commercial real estate, Zia said the long-term outlook for India’s residential property market remains steady, with price growth expected to average around 7–8 percent annually.

He also suggested that investors could consider buying raw land in areas likely to benefit from future infrastructure development, noting that such investments could gain value as connectivity improves.

Zia added that amid ongoing geopolitical tensions, some real estate investors are also discussing alternatives to investments in the Middle East.