Global Capability Centres (GCCs) in India have increased their use of flexible office spaces, leasing nearly 23,000 coworking desks between January and September 2024, according to a new report from Knight Frank India. The report, titled “GCC – Driving India’s Real Estate Growth Story,” highlights the rising trend of GCCs as dominant users of coworking spaces in the country’s major cities, with Bengaluru accounting for a significant 41% of these flex seats, followed by other key markets. This increase marks a resurgence in flex seat occupancy, rising from 17,380 seats in 2023 to 22,881 in 2024.

According to Knight Frank India, this demand for flexible spaces reflects a strategic shift by global firms adapting to economic challenges abroad, particularly in the US. “The cost-efficient nature of flexible workspaces has further driven a notable increase in occupancy rates among Global Capability Centres (GCCs) in 2024,” said Shishir Baijal, Chairman and Managing Director of Knight Frank India. He noted that India’s skilled workforce and affordable office spaces provide a distinct advantage for global companies, prompting them to explore flexible workspace options more frequently.

This renewed interest comes after GCC occupancy rates declined from 2021 to 2023 as companies returned to traditional offices post-pandemic. However, slower economic growth abroad and the desire for operational flexibility have encouraged global firms to turn to India’s coworking market, which offers both cost savings and a robust talent pool. The report notes that GCCs occupy approximately 202.6 million square feet of Grade A office space across India’s top six cities, with Bengaluru and Hyderabad comprising 75% of this leased space.

Sector-wise, the IT/ITeS industry remains the largest occupier of coworking spaces among GCCs, followed by BFSI and consulting sectors. Mumbai leads in GCC occupancy for BFSI companies, while Bengaluru dominates in IT/ITeS, underscoring the region’s role as a tech hub for multinational firms. GCCs based in the Americas, particularly the US, comprise about 66% of India’s coworking occupancy. The EMEA (Europe, Middle East, and Africa) region contributes 27%, with emerging interest from Japan, Singapore, and Australia, reflecting Asia-Pacific’s rising influence.

Baijal explained that India’s appeal as a GCC destination is supported by its stable political climate, consumer-driven economy, and favourable regulatory framework, making it an increasingly preferred location for multinationals. As GCCs expand their presence, Knight Frank anticipates sustained growth in coworking adoption, driven by India’s cost advantages and talent resources.

In conclusion, as India’s real estate and coworking markets grow, the strategic shift by GCCs indicates a lasting demand for flexible workspaces that provide operational efficiency without compromising access to a highly skilled workforce. With over 1,900 GCCs established in India, Knight Frank projects continued growth as the sector adapts to evolving global and economic needs.