Global Capability Centres Emerge As Big Players in Indian Commercial Real Estate

In Bengaluru, the landscape of office leasing is witnessing a significant shift. Global Capability Centres (GCCs), the tech and shared service limbs of multinational corporations, are claiming a larger slice of the commercial real estate pie in India. Colliers, a notable name in real estate management, highlights an impressive trend: the space leased by GCCs in 2023 has hit its peak since the start of the decade.

A Shift Towards GCC Dominance

Post-pandemic, GCCs have emerged as formidable players in the commercial real estate arena, a space once dominated by IT firms. Colliers' data paints a vivid picture: a leap from 17 million square feet of space leased in 2020 to a striking 21.1 million in the last year, accounting for 37% of the total office space leased. This figure is on the cusp of touching 40% in the coming two years.

GCCs vs. IT Services: The Hiring Battle

With over 1,600 GCCs rooted in India, their hiring spree has outpaced that of the traditional IT service sector. This surge in employment is not just a number game but a transformative force in the commercial real estate sector. Cushman and Wakefield's recent insights confirm the pivotal role of GCCs in propelling the growth of India's commercial landscape, predicting their dominance in the near future.

A Year of Expansion and Establishment

The past year has seen an impressive expansion and establishment of more than 80 GCCs, according to a report by real estate consultancy Knight Frank. This expansion marks GCCs as the only segment within the commercial space to witness growth in 2023, contrasting the decline in flex and co-working spaces and third-party IT firms. Big names like Deloitte, Qualcomm, MUFG Bank, Bank of America, Citibank, and Fidelity have been major occupants, signaling a robust demand for office spaces by GCCs.

Traditionally inclined towards private office spaces, GCCs are gradually showing a preference for flex spaces. Up to 10% of these adaptable workspaces are now home to GCC operations, indicating a shift in their real estate strategy and a broader acceptance of flexible working environments.

The ascendancy of Global Capability Centres in India's commercial real estate market underscores a dynamic shift in the landscape of office spaces. With their growing footprint and evolving preferences, GCCs are not just reshaping the way we think about workspaces but are also setting new trends for the future of work in India.