MNCs prefer institutional office assets for setting up GCCs in India: C&W

Multi-national companies are preferring office space owned by REIT landlords for setting up their Global Capability Centers (GCCs) in India, according to Cushman & Wakefield.

Property consultant Cushman & Wakefield in its report 'Asia REIT Market Insight 2024-25' highlighted that the three listed office REITs have delivered more than 15 per cent of capital appreciation in the last 12 months ended June.

There are three office REITs in India -- Brookfield India Real Estate Trust, Embassy Office Parks REIT, Mindspace Business Parks REIT -- while the Nexus Select Trust is backed by retail real estate.

As of June 2025, the Indian REIT market, comprising all four REITs, had an operational portfolio size of more than 105 million sq ft.

"By the end of the calendar year 2025, a fourth office REIT is expected to make its listing debut on the bourse," the report said.

Bengaluru-based Sattva Group and Blackstone-backed Knowledge Realty Trust (KRT) have already filed Draft Red Herring Prospectus (DRHP) with the SEBI.

"With 48 million sq ft of pan-India Grade A office space (37 million sq ft operational and 11 million sq ft under development), we expect to see KRT become one of the largest real estate investment trusts listed in India," the consultant said.

The report highlighted that MNCs are preferring institutionally owned office assets.

"At a Pan-India level, GCCs have accounted for 28-29 per cent of GLV (gross leasing volume) on average over the last four quarters up to Q1 (January-March) 2025," the report said.

In contrast, the consultant said that REIT landlords were able to achieve 40-60 per cent of total leasing demand coming from GCC firms.

In the 2024 calendar year, Cushman & Wakefield data showed that the gross leasing of office space stood at record 89 million square feet across seven major cities.

The report also mentioned that India's office REIT stocks have outperformed the Bombay Stock Exchange (BSE) Realty Index significantly.

During the 12-month period up to June 2025, all three office REIT stocks delivered more than 15 per cent capital appreciation.

"The key driver has been the underlying strength of India's office real estate market, triggered by heightened demand from GCCs, engineering and manufacturing, and BFSI firms," the report said.

The consultant noted that REIT landlords are also benefiting from growing preference for premium workspaces by corporates.