India has become a top destination for Global Capability Centers (GCCs), with firms leasing nearly 53 million square feet of office space in major cities since 2022, according to a CBRE and Zyoin report. The report reveals that 67% of GCCs intend to expand their office space by at least 10% over the next two years, underscoring strong future demand. GCCs accounted for 37% of total office leasing in H1 2024, highlighting their growing influence in the real estate market. This trend is driven by India's skilled workforce, cost-effectiveness, and supportive government policies, positioning the country as a prime hub for global business.
India's position as a favourable destination for Global Capability Centers (GCCs) has seen significant growth in recent years. A new report from CBRE and Zyoin emphasises the leap in operations by GCCs in India, attributing this growth to several factors, including a skilled workforce, cost-effectiveness, and supportive government policies. As a result, global firms have leased nearly 53 million square feet of office space in major cities such as Bengaluru, Hyderabad, Chennai, Pune, Delhi-NCR, and Mumbai since 2022.
One of the most striking insights from the report is the future outlook for GCCs. Approximately 67% of these centres plan to expand their office space by at least 10% in the next two years. This anticipated increase suggests a strong, sustained demand for commercial real estate in India. Developers are likely to see this trend as an opportunity to create more office spaces tailored to the needs of these companies, therefore potentially leading to advancements in building design and infrastructure.
The cost and availability of quality real estate are crucial factors contributing to the growth of GCCs in India. According to the report, leasing by GCCs accounted for 37% of total office leasing during the first half of 2024. This statistic highlights how GCCs are not just participants in the real estate market but are becoming dominant players. This shift also puts pressure on developers to enhance their offerings, focusing on creating innovative work environments that cater to modern business needs.
Moreover, the Indian government's push for improving the ease of doing business has created a favourable climate for foreign investments, making it an attractive location for GCCs. Tax incentives and streamlined regulations have further cemented India's appeal as a strategic hub for organisations looking to set up operations in the region. This policy environment, combined with a large, English-speaking workforce, positions India as a favourable alternative to other regions for companies looking to optimise costs.
As GCCs continue to establish and expand their presence in India, the commercial real estate market is evolving to accommodate these changes. Developers are being encouraged to plan and innovate, leading to a rise in specialised office spaces that meet the unique demands of GCCs. This growing competitiveness in the commercial real estate sector is not only beneficial for global companies but also generates an influx of jobs, bolstering the local economy.
In conclusion, the upward trajectory of GCCs in India indicates a healthy commercial real estate market ahead. The call for additional office space reflects the confidence these global centres have in India's economic stability and growth potential. As engagement deepens between global firms and the Indian market, it is expected that the commercial real estate landscape will continue to thrive, supporting the ongoing transformation of India's corporate environment. This trend positions India strategically on the global stage, further enhancing its significance in the international business landscape.
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