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Global capacity centers (GCC) has leased 24.9 million sq ft in 2024, almost triple from 9.1 million sq ft in 2022, taking its share in overall leasing to 28% this year against 13% in 2022.
ET Year-end Special Reads Stocks to buy in 2025: 66 ideas from top brokerages for your new year portfolio What does 2025 hold for India's IT services sector? 2025 may be the year of EVs in India, dominated by SUV launches In the last two years, 124 new companies transacted GCC deals and took up office space for greenfield capability or R&D centres. "The growing presence of Global Capability Centers , contributing nearly 30% of total demand, underscores India’s strategic importance for global multinationals. As we move into 2025, the demand for Grade-A spaces is expected to remain robust, further solidifying India’s dominance in the global office market,” said Anshul Jain, Chief Executive, India, Southeast Asia and APAC Tenant Representation, Cushman & Wakefield.
India’s office sector closed 2024 with historic achievements, recording an unprecedented 89 million square feet (MSF) of gross leasing volume (GLV) across the top 8 cities, according to Cushman & Wakefield’s latest office data. This marks the highest ever GLV recorded in the sector, surpassing 2023’s peak by a significant 14 MSF and a 19% increase. Gross leasing volume, which factors in all leasing activity in the market, including fresh take-up, open market renewals by corporates as well as pre-leasing, is an indication of overall market activity.
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This has led to a vacancy rate of 16% in 2024, a drop of 1.8-2% from last year. Core markets across all major cities have tightened further with increased demand from multinationals.
However, 2025 is expected to see a recovery in supply, with a considerable portion of it coming in the suburban markets across key cities. The fourth quarter of 2024 was a key contributor to the strong demand as GLV and net absorption for the quarter stood at 24 MSF and 16 MSF, respectively. The second half of the year accounted for nearly 55-58% of the overall GLV and net absorption for the year.
In terms of sectoral performance, IT-BPM sector was the largest contributor to demand with nearly 30% share in Q4 2024, followed by Eng. & Mfg. and BFSI sectors with 23% and 16% shares, respectively.
The flex sector also contributed to the demand by accounting for 14% share in GLV. For the full year too, these sectors accounted for top-4contributing segments with IT-BPM capturing a 29% share, followed by BFSI and engineering and manufacturing each at 17%, and flex at 14%. Global capability centers (GCCs) accounted for 27-29% of the overall demand for office spaces for 2024 thereby reinforcing its significance for the Indian economy and commercial real estate sector.
"The Indian office market is on a strong footing as can be seen through three years of consistent surge in leasing activity. 2024 has been exceptional, even surpassing our bullish mid-year projections of demand crossing 80 MSF. Primary growth drivers such as GCCs, flex, domestic companies especially in banking and financial services, and growth of manufacturing etc, remain intact, we do foresee 2025 to carry forward thepositive momentum,” said Veera Babu, Managing Director, Tenant Representation, Cushman & Wakefield.
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