How is India’s GCC Growth Impacting Commercial Workspaces?
Cities such as Bengaluru, Hyderabad, and Pune have experienced a significant influx of these centers, fostering a vibrant ecosystem for innovation and growth. But what implications does this have for the demand and design of commercial workspaces in India?
As GCCs continue to expand, they reshape the real estate market and influence the utilisation and development of office spaces across the country.
In this blog, we will discuss India’s GCC growth impact on commercial workspaces and how this shift is redefining the future of office environments in the country.
What are GCCs, and Why are They Important for India?
Global Capability Centres (GCCs) serve as hubs where companies worldwide outsource or centralise various functions, including IT support, research and development (R&D), finance, customer service, and more. These centres give companies access to India’s skilled labour force at competitive costs.
India has quickly become one of the leading destinations for GCCs. A report by Nasscom (National Association of Software and Service Companies) shows that India accounts for about 50% of the global market share for offshore GCCs. This figure is expected to grow further in the coming years, with GCCs projected to contribute over $40 billion to India's GDP.
This growth has generated hundreds of thousands of jobs and significantly enhanced India’s standing in the global outsourcing industry.
India’s GCC Growth Trends
India’s GCC sector has witnessed exponential growth, driven by the country's skilled workforce, cost advantages, and technological infrastructure.
According to a report by Nasscom and Zinnov, between FY2019 and FY2024, over 400 new GCCs were established in India, bringing the total number to over 1,700. In FY2024, these GCCs generated $64.6 billion in export revenue and employed over 1.9 million people.
Several key sectors are contributing to the growth of GCCs in India.
- IT & Software: Indian cities like Bangalore and Chennai are leading global IT hubs, housing major GCCs for tech giants like Microsoft, Google, and Accenture.
- Finance and Accounting: Cities like Mumbai and Gurgaon have seen significant investments in finance-based GCCs servicing clients worldwide.
- Research and Development: India’s strong R&D infrastructure attracts global companies, especially in the pharmaceuticals, biotechnology, and automotive sectors.
The growth of tier-2 cities like Kochi, Chandigarh, and Indore has further propelled the expansion of GCCs, as businesses seek to capitalise on more affordable commercial real estate and a talent pool emerging beyond metro cities.
The Impact of India’s GCC Growth on Commercial Workspaces
As India’s GCC sector grows, so does the demand for commercial workspaces. Below are the significant impacts that GCC has on commercial workspaces.
Impact of GCC on Office Space Demand
GCCs require large, high-quality office spaces to accommodate their growing workforce. In response, commercial real estate developers prioritise developing Grade-A office buildings in key cities, especially those with a high concentration of GCCs.
For example, Hyderabad, which is home to one of the largest tech hubs in India, has seen its commercial office space demand increase by around 30%. Bangalore and Pune are also witnessing a similar trend.
Flexible Workspaces & Hybrid Models
GCCs are increasingly adopting flexible workspace models to accommodate the evolving needs of a hybrid workforce. This has led to a rise in demand for coworking spaces and flexible office leases, allowing companies to scale up or down based on their needs.
The growth of The Executive Centre, Regus, and Awfis in cities like Bangalore, Delhi, and Mumbai is a direct result of this shift. Commercial real estate developers are also pivoting towards flexible and hybrid office spaces to align with the demands of the modern workforce.
The Role of Technology in Commercial Workspaces
With the GCC growth comes the need for technology-driven, innovative workspaces. Many GCCs embrace digital-first strategies, enabling remote and hybrid work options for their employees. This shift is reflected in the design of commercial workspaces.
Smart office solutions like IoT-enabled lighting, energy-efficient HVAC systems, and AI-driven workspace management are becoming increasingly common in new commercial developments.
These solutions enhance operational efficiency and align with the growing demand for sustainable and tech-enabled office spaces.
Challenges and Opportunities for Commercial Real Estate in the GCC Era
While the GCC boom is undoubtedly beneficial for commercial real estate in India, developers must address certain challenges.
Challenges
- Rapid real estate development in major cities may result in oversupply, potentially reducing rental yields in the long term.
- The increasing demand for commercial office spaces could result in price inflation, particularly in saturated markets such as Bangalore and Mumbai.
- As companies adopt hybrid models, traditional office layouts become outdated. Real estate developers must innovate with collaborative, flexible, and tech-enabled spaces.
Opportunities
- With a growing emphasis on eco-friendly practices, developers have an excellent opportunity to construct green buildings certified by LEED or BREEAM.
- Providing customisable office spaces that can adapt to varying company needs will give developers a competitive advantage in the commercial real estate market.
Future Outlook of India’s Commercial Workspaces Amid GCC Growth
As India’s GCC sector continues to grow, the future of commercial workspaces appears promising. The rising adoption of hybrid and flexible working models will boost demand for adaptable office spaces.
Real estate developers are expected to invest in multi-functional, tech-driven spaces that cater to the needs of GCCs, whether for large office floors or smaller co-working areas.
Emerging cities like Kochi and Chandigarh will also experience significant growth as they attract more GCCs looking for affordable office spaces and a growing talent pool.
Want to Join India’s Rising Economy?
India’s GCC growth impact on commercial workspaces is substantial and continues to shape the future of the real estate market. Developers must adapt to these emerging trends as there is increasing demand for flexible, tech-driven, and collaborative office spaces.
Despite challenges like oversupply and market fluctuations, the opportunities for developers, investors, and companies looking to expand in India are vast. The rise of hybrid work models and the steady growth of GCCs are reshaping commercial real estate, providing innovative solutions for the evolving workforce.
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