Hyd among top 3 Indian cities in GCC leasing

Hyderabad: Hyderabad remains in the top three cities driving office space absorption by Global Capability Centres (GCCs) in India during January-June (H1) of 2023, global real estate consulting firm CBRE South Asia Pvt Ltd said in its report – India’s GCCs-charting a new technology era – released by the company Thursday. The report elaborates on the growth of the GCCs in India, leasing preferences, and key drivers for expansion.

“Leasing by the GCCs during H1’23 in the city stood at 1.4 million sq ft. In between H1’ 22 and H1 ’23, key micro markets for the GCC leasing were IT Corridor II and Extended IT Corridor. The GCC leasing quantum between 2022 and H1 2023 is 6 million sq ft with a 35 per cent share dominated by the tech sector companies,” the company said in a statement.

“The growth of GCCs in Hyderabad comes in the backdrop of ample talent availability and an improving standard of living, comparatively lower costs, amidst proactive government initiatives. The city has witnessed GCC activity from across sectors such as technology, life sciences and consulting services,” it added.

As per the report, the GCCs are likely to lease office space of around 60-62 million sq ft of space during 2023-25. The sectors including technology, BFSI and engineering & manufacturing will lead leasing activity, while sectors such as life sciences, automobiles, and aviation will also expand their GCC operations in India.

Cementing the long-term intent of global corporates in India, GCCs are now leasing larger offices with the potential to scale up in the future. North American firms continue to be the mainstay of GCCs in India. Availability and cost of talent, real estate, and supporting regulatory framework aid GCCs expansion in India.

By 2025, it is estimated that there will be around 1,900 total operational GCCs in the country from existing nearly 1,580. During this period, GCC leasing activity is expected to account for 35-40 per cent of the overall office leasing.

Anshuman Magazine, Chairman & CEO - India, South-East Asia, Middle East & Africa, CBRE, said, “India has emerged as the most preferred destination for GCCs worldwide, and the growth of GCCs in India is a testament to the country’s skilled talent, cost efficiency, favourable business environment, and government support. Post the pandemic, global firms were nudged to re-evaluate their business offerings to increase digitisation levels. In a bid to ensure business agility, improve efficiency and make their businesses resilient, a higher number of MNCs explored multi-functional GCCs in India. Gradually, mid, and smaller-sized firms also started venturing into the Indian shores to enhance their offerings.”