Connect with us










News

Leasing by Global Capability Centres in India Up 17 % YoY, at 22.5 mn sq ft in FY24 

May 28, 2024: CBRE South Asia Pvt. Ltd announced that leasing by Global Capability Centre (GCC) increased by ~17% Y-o-Y in FY 2023-24 compared to FY 2022-23. The leasing by GCC’s in the country stood at 22.5 mn. sq. ft. in FY 2023-24 as compared to 19.2 mn. sq. ft. in FY 2022-23. This growth during Apr 2023-Mar 2024 was primarily driven by key sectors such as Engineering and Manufacturing, BFSI and technology sectors.

In Jan-Mar 2024, GCCs leased ~ 29% of the total office space leased in India. Notably, the total leasing in the GCC segment stood at 4.2 mn. sq. ft. in Jan-Mar ‘24. Among these GCCs, E&M (Engineering and Manufacturing) companies accounted for over a quarter of the space, with automobile firms following closely behind.

GCC leasing share in Jan-Mar’24

GCCs have become an important catalyst for change in the Indian office sector. With 1.3 mn talent as of 2019, the sector saw a 30–35% share of total office leasing in India in 2017-2019 period with over ~1250 operational GCCs. Between 2020-2022 period, GCCs accounted for 38–43% of the total leasing, housing over 1580 operating GCCs with a talent pool of 1.66 mn as of 2022. We anticipate that during 2023-2025 period, the GCCs will account for a significant 35–40% of the total office leasing. Moreover, India has been a leader in the growth of GCCs, expected to host over 1,900 GCCs by 2025 with a professional talent pool that exceeds 2 mn. 

India’s vast reservoir of skilled professionals positions it as a premier destination for GCCs aiming to tap into a diverse talent pool and enhance their operational capacities. With an estimated 5.4 million tech experts, India provides GCCs with an abundant talent landscape for thriving and innovating. Moreover, the country offers a competitive cost framework encompassing talent, rentals, and operational costs, presenting an attractive proposition for businesses seeking to optimize their operational expenses while maintaining high standards. 

Established companies, encouraged by the success of their current operations, are actively pursuing expansion initiatives. Major global players in sectors like BFSI (Banking, Financial Services, and Insurance), technology, and Engineering and Manufacturing (E&M) are anticipated to grow their GCC presence in India further, potentially exploring multi-functional centers. Established GCC occupants with long-term strategies may consider establishing large campuses in India’s key urban center.

The trajectory of Global Capability Centers (GCCs) in India is poised for a significant shift, driven by a growing demand for premium office spaces that offer modern amenities and enriching experiences for the workforce. As occupiers increasingly prioritize quality, they will seek out office buildings that provide not only superior infrastructure but also tailored and engaging workplace environments. This trend, coupled with improving office occupancies and the evolution of work patterns, will lead to a heightened focus on investing in high-quality office spaces that meet the changing needs of GCCs.

Advertisement










Trends
By 2025 number of operationalGCCs are expected to expand by 20%.CBRE Projects significant leasing by GCCs at 40-45 million sq ft. between 2024-2025
Growth to be driven by companies establishing large campuses to strengthen their presenceEmerging sector like life sciences, automobiles and aviation to join the expansion wave

Anshuman Magazine, Chairman & CEO – India, South-East Asia, Middle East & Africa, CBRE, said, “With projections indicating significant leasing by GCCs at 40-45 million square feet between 2024 and 2025, India’s strategic emphasis on digital technology, combined with its competitive costs for talent and rentals, remains instrumental in propelling the growth. The gradual upskilling of talent in existing as well as new roles and greater synergies between the private sector and educational institutions would continue to drive value creation in India. Consequently, the country is likely to witness more state-of-the-art GCCs going ahead.”

Ram Chandnani, Managing Director, Advisory & Transactions Services, CBRE India, said, “The trajectory of Global Capability Centers (GCCs) in India is shifting, driven by the demand for premium office spaces with modern amenities. Occupiers prioritize quality, seeking superior infrastructure and engaging environments. This trend, along with improving office occupancies and evolving work patterns, will increase investment in high-quality spaces for GCCs. India’s growth as a global hub for innovation and talent underscores the country’s potential as a prime destination for business expansion.”

Trending