Leasing by GCC in India surge approx. 17 pc YoY, recording 22.5 mn. sq. ft. in FY 2023-24

New Delhi [India], May 28 (ANI): CBRE South Asia Pvt. Ltd, has announced an increase in leasing by Global Capability Centres (GCCs) in India, surged by approximately 17 per cent year-on-year in FY 2023-24, reaching 22.5 million square feet, up from 19.2 million square feet in FY 2022-23.
According to the press release, this growth, recorded from April 2023 to March 2024, was largely driven by the engineering and manufacturing (E&M), Banking, Financial Services and Insurance (BFSI), and technology sectors.
In the first quarter of 2024 alone, GCCs accounted for about 29 per cent of the total office space leased in India, with 4.2 million square feet leased from January to March.
E&M companies led the way, occupying over a quarter of this space, followed closely by automobile firms.
GCCs have become a driving force in the Indian office sector, attracting substantial leasing volumes. With a talent pool of 1.3 million in 2019, GCCs accounted for 30-35 per cent of total office leasing in India during the 2017-2019 period, with around 1,250 operational centres.
This number grew to 1,580 GCCs and a talent pool of 1.66 million by 2022, accounting for 38-43 per cent of total leasing from 2020-2022.
Projections indicate that from 2023 to 2025, GCCs will maintain a significant presence, accounting for 35-40 per cent of total office leasing. By 2025, India is expected to host over 1,900 GCCs, with a talent pool exceeding 2 million professionals.
India's large pool of skilled professionals positions it as a premier destination for GCCs. The country boasts an estimated 5.4 million tech experts, providing GCCs with ample talent for innovation and growth.
Moreover, India's competitive cost structure--encompassing talent, rentals, and operational expenses--offers an attractive proposition for businesses looking to optimize costs while maintaining high operational standards.
Encouraged by their success, established companies in sectors such as BFSI, technology, and E&M are pursuing expansion initiatives.
Many are exploring the establishment of large campuses and multi-functional centres in India's key urban areas.
This trend reflects a growing demand for premium office spaces that provide modern amenities and engaging work environments, driven by improving office occupancies and evolving work patterns.
By 2025, the number of operational GCCs in India is expected to increase by 20 per cent, with CBRE projecting significant leasing activity totalling 40-45 million square feet between 2024 and 2025.
Emerging sectors like life sciences, automobiles, and aviation are expected to join the expansion wave.
Anshuman Magazine, Chairman & CEO - India, South-East Asia, Middle East & Africa, CBRE, said, "With projections indicating significant leasing by GCCs at 40-45 million square feet between 2024 and 2025, India's strategic emphasis on digital technology, combined with its competitive costs for talent and rentals, remains instrumental in propelling the growth."
He added, "The gradual upskilling of talent in existing as well as new roles and greater synergies between the private sector and educational institutions would continue to drive value creation in India. Consequently, the country is likely to witness more state-of-the-art GCCs going ahead."
Ram Chandnani, Managing Director, Advisory & Transactions Services, CBRE India, said, "The trajectory of Global Capability Centers (GCCs) in India is shifting, driven by the demand for premium office spaces with modern amenities. Occupiers prioritize quality, seeking superior infrastructure and engaging environments."
He added, "This trend, along with improving office occupancies and evolving work patterns, will increase investment in high-quality spaces for GCCs. India's growth as a global hub for innovation and talent underscores the country's potential as a prime destination for business expansion." (ANI)