What’s shaping India’s commercial real estate
The Brookfield Properties APAC Leadership Summit 2024 spotlighted key commercial and office space trends in the Indian market.
The Brookfield Properties APAC Leadership Summit 2024 brought together leadership teams from Australia, Asia, and the Middle East. This immersive event, spanning seven days and three cities in India, provided a unique platform for knowledge-sharing, collaboration and trendspotting. Leaders seized this exclusive opportunity to exchange insights, experiences and best practices.
A highlight of the summit was the inclusion of two trendspotting sessions held in Delhi-NCR, featuring industry partner companies. These sessions aimed to illuminate commercial and office space trends across the APAC region, and were attended by global and Indian corporate leaders, tenants and independent board members of Brookfield India Real Estate Trust.
Here’s an overview of some of the key India-specific trends explored during these sessions:
The rise of Global Capability Centers
Global Capability Centers (GCCs) are strategic units established by multinational corporations in places such as India, China and Eastern Europe to deliver various business functions and services. Leveraging India’s abundant talent pool, cost advantages, and favorable regulations, GCCs located in the country are delivering top-tier services on a global scale. These GCCs are evolving from being a source of cost arbitrage to being value-generating organizations in areas such as Finance, Research & Development and Artificial Intelligence. With over 1,580 GCCs currently operational, employing more than 1.6 million individuals and revenue exceeding USD 46 billion, India has solidified its position as one of the top destinations. Projections suggest that by 2030, the GCC market in India will burgeon into a USD 110 billion industry, fostering employment opportunities and driving innovation and technological advancements.
Embracing sustainability practices
India’s real estate sector is witnessing a paradigm shift towards sustainability principles. This trend is most evident in the proliferation of green buildings, energy-efficient infrastructure and initiatives aimed at reducing carbon footprints. Presently, 49% of the total office stock in India is certified as green buildings, reflecting the industry’s commitment to responsible and ethical business practices. Developers are aligning their strategies with sustainability criteria, prioritizing data collection on emissions, energy usage, water and chemical management, diversity and inclusion initiatives, and amenities promoting occupant health and wellbeing.
The growth of flexible office spaces
The growing demand for flexible office spaces is being driven by the need for agility, cost-efficiency and dynamic work environments. Companies are increasingly gravitating towards flexible operators offering adaptable workspace solutions that enable scalability and collaborative work cultures. India’s flexible workspace industry has seen a four-fold increase between 2020 and 2023. Forecasts predict that flex stock in India’s top six cities will surpass 80 million square feet by 2026, amounting to 9-10 % of Grade A office stock. While major cities like Bengaluru and Hyderabad lead the flex trend, Tier-II cities such as Bhubaneswar, Coimbatore and Ahmedabad are gaining traction due to their cost-effectiveness, talent pool, infrastructure development and market potential.