Leading commercial real estate firm, RMZ Corp, reports a surge in demand for premium office spaces in India, attributing it to the rise of Global Capabilities Centres (GCC). Major global players have recently leased 5 million sq ft for their GCCs in the country. RMZ Corp, eyeing expansion in Gurgaon, has plans for a vast development project, underscoring India's appeal as a preferred destination for businesses. The company's strategic growth is evident through partnerships and a robust project pipeline, forecasting a bright future for India's commercial real estate landscape.
Leading commercial real estate firm, RMZ Corp, has highlighted the rising demand for premium commercial spaces in India, crediting Global Capabilities Centres (GCC) as the primary drivers. Within a span of 18 months, major companies such as UPS Technologies, Haleon, Planview APAC, Booking Holding, and Nielsen have leased an impressive 5 million sq ft to establish their GCCs in the country.
Mr. Thirumal Govindraj, Senior Managing Director on the Executive Board of RMZ Corp, shared his insights with Financial Express. According to him, India remains a hotspot for GCCs, primarily due to the abundance of skilled talent. With a steady growth rate in the GCC market, he anticipates the addition of over 500 centres in the upcoming years.
Govindraj disclosed that RMZ Corp has successfully leased over 5 million sq ft across its portfolio, introducing 38 new tenants in the GCC sector. Typically, GCCs begin by leasing spaces ranging between 100,000-150,000 sq ft. As their ventures prosper, this could exponentially increase to anywhere between 0.5 to 1 million sq ft.
Setting its sights on expansion, RMZ Corp is presently zeroing in on Gurgaon within the NCR region. After establishing a firm footing there, the company aims to venture into other Northern markets. According to him, the company aims to procure a substantial land parcel in Gurgaon to construct approximately 4-4.5 million sq ft of office space.
Further emphasizing RMZ's growth strategy, he also spoke about partnerships with CPPIB Investments and Mitsui Fudosan. Notably, a 50:50 joint venture with CPPIB in April 2021 witnessed an investment of around $210 million, earmarked for the development of about 10.4 million sq ft of office spaces in Hyderabad and Chennai. Another significant 50:50 JV was established in March 2022, with an investment of $355 million, aimed at constructing and acquiring commercial spaces in key Indian cities.
The real estate behemoth currently boasts a presence in six prime cities, with 19 projects sprawled across a whopping 70 million sq ft Asset Under Management. RMZ Corp envisions expanding its asset portfolio to an astounding 350 million sq ft by the year 2032.
Previously concentrated in Bengaluru, RMZ Corp has broadened its horizons, with Hyderabad now being a dominant player in its portfolio. Recent landmark acquisitions in Mumbai and Pune are projected to add another 10 million sq ft, potentially elevating the company’s AUM by $3 billion.
Regarding potential ventures in logistics, warehousing, and data centres, Govindraj signalled an optimistic yet cautious approach. With the rise of AI, the demand for data centres is predicted to skyrocket. On regulatory implications of RERA's proposition to oversee commercial real estate, Govindraj opined that their model, which involves leasing buildings to retail investors, doesn't necessitate such oversight.
In conclusion, The flourishing demand for Grade A commercial real estate in India, propelled by the establishment of GCCs, showcases the country's emerging stature as a global hub for business. With strategic expansions and partnerships, RMZ Corp is poised to capitalize on this upward trajectory.
This story was earlier published in ET Realty and Financial Express
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