South Indian cities dominate GCC office leasing in Q1 CY25: Report

Bengaluru leads and it is followed by Chennai and Hyderabad; real estate trend spreading to smaller places too

Cities in South India comprised 64 per cent of office leasing by global capability centres (GCCs) in the first quarter of calendar year 2025 (Q1 CY25), according to a report by a property consultancy firm.

 

Of the 8.35 million square feet (msf) gross office space leased by GCCs in Q1 CY25 in top seven cities, Bengaluru, Chennai and Hyderabad collectively leased about 5.34 msf. Delhi National Capital Region (NCR) leased 1.95 msf to GCCs, said Anarock.

 

“Of the gross office space leasing of 19.47 msf recorded in the top seven cities in Q1, GCCs accounted for about 8.35 msf – a 43 per cent overall share. In Q1 CY24, they had leased about 4.87 msf. There has been a 72 per cent annual jump in their office space absorption," said Peush Jain, managing director – commercial leasing and advisory, Anarock Group.

 

GCCs, which are strategic hubs of multinational corporations, are ramping up their presence in India as government initiatives announced in the Union Budget accelerate the trend, according to Anarock. The top cities are recording increasing demand for office space by new GCC entrants and those expanding their operations.

 

The top seven cities recorded gross leasing of more than 141.43 msf of office space in 2023 and 2024. Of this, GCCs leased about 52.88 msf (over 37 per cent).

 

GCCs of information technology companies comprised 35 per cent of overall leasing by GCCs in Q1 CY25. BFSI came next with a 22 per cent share, followed by manufacturing and industrial (13 per cent), e-commerce (6 per cent) and consultancy businesses (5 per cent). The remaining 19 per cent of space was leased by miscellaneous sectors.

 

“Driven by India’s rising economic influence over the last two to three years, GCCs are deploying not just in the top seven cities but also in various Tier-II and -III cities, including Ahmedabad, Kochi, and Coimbatore," said Jain. "This is due to a combination of factors, including a growing skilled workforce beyond the metros, cost competitiveness, supportive government policies, and concerted infrastructure development in tier two and tier three cities."

 

In Q1 CY25, Bengaluru led in office space leasing at 40 per cent share. It was followed by Delhi NCR (23 per cent) and Chennai (15 per cent).

 

Of the GCCs which leased office space in Indian cities in Q1 CY25, 65 per cent were headquartered in the United States, followed by 28 per cent in Europe and the Middle East, and 7 per cent in the Asia-Pacific region.

 

Over 1,700 GCCs were operating across the top seven cities in India by 2024-end. Their cumulative market value is estimated at approximately $52 billion.l