GCCs' Leasing Activity Hits an All-Time High Crossing 29 mn. sq. ft. in 2024: CBRE Companies from sectors including Technology, Engineering & Manufacturing and BFSI would likely drive demand for both traditional and flexible office spaces for their GCCs.
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Global Capability Centres (GCC) maintained strong leasing in 2024 at 29.4 million sq. ft. with a share of 37 per cent of the overall leasing activity across the top 9 cities in India and registering about 29 per cent Y-o-Y growth, according to CBRE South Asia, leading real estate consulting firm.
Global firms have actively established and expanded their GCC operations by capitalising on the country's skilled talent pool and a favourable business climate. This growth momentum is expected to persist into 2025, with new entrants setting up global centres and existing firms scaling their facilities.
Companies from sectors including Technology, Engineering & Manufacturing and BFSI would likely drive demand for both traditional and flexible office spaces for their GCCs, with continued demand from niche sectors such as automobile, semiconductors, and life sciences.
In the Oct-Dec 2024 period, GCC leasing represented 34 per cent of the total leasing activity, amounting to 7.6 million. sq. ft. Bengaluru led the GCC leasing segment with a 34 per cent share, followed by Hyderabad at 20 per cent, Delhi-NCR at 12 per cent, Mumbai at 11 per cent, Pune at 10 per cent, and Chennai at 9 per cent. Ahmedabad, Kolkata and Kochi together accounted for 4 per cent of the GCC leasing in Q4 2024.
On a pan-India basis, overall, office leasing recorded a historic high of 79 million sq. ft. in 2024 across 9 cities. The absorption marked a 16 per cent Y-o-Y growth, setting a new benchmark for leasing activity. Total supply during CY 2024 stood at 52.3 million sq. ft.
Bengaluru dominated office space absorption during the year, accounting for approximately 28 per cent share of the total, followed by Hyderabad with 16 per cent and Mumbai with 15 per cent share. In 2024, approximately 52.3 million. sq. ft. of new office space was completed, with Bengaluru, Hyderabad, and Pune collectively accounting for 67% of the total supply addition.
Technology sector accounted for 24 per cent of the total leasing activity, followed by flexible space operators at 19 per cent, BFSI firms at 16 per cent, and engineering and manufacturing companies at 9 per cent. Domestic firms continued to lead the space take-up in CY 2024, accounting for 45 per cent of the total office space absorption, followed by companies from the Americas at 34 per cent, EMEA at 16 per cent, and APAC at 5 per cent. The leasing activity by Indian firms was predominantly driven by flexible space operators, technology companies, and BFSI corporates.
"As we look towards 2025, the office sector in India is poised for continued growth, underpinned by sustained demand from a broad range of industries. The momentum seen in 2024 is expected to persist, with technology, BFSI, and engineering sectors, along with GCCs, driving the need for both traditional and flexible office spaces. Companies are increasingly prioritizing operational efficiency, which would further enhance demand for premium, future-ready assets that are designed to foster employee well-being and provide a competitive edge in talent retention," said Anshuman Magazine, Chairman & CEO - India, South-East Asia, Middle East & Africa, CBRE.
