The GCC Hurricane: How Global Firms are Unleashing Noida’s Real Estate Landscape

“Commercial Office Rents in Top Indian Cities are 50% lower than competing Asian markets and 60% lower than competing European Markets” – CBRE Aug 2024

What are Global Capability Centers?

Global Capability Centers (GCCs) are specialized hubs established by multinational companies to manage key business functions like IT, Finance, HR, Analytics, and R&D. These centers act as strategic extensions of a company’s operations, centralizing processes that require specialized skills and resources. At one place, a company develops top tier facilities, coupled with a strong talent in a cost-effective structure. By setting up GCCs, companies can enhance efficiency, reduce operational costs, and tap into global talent pools, which ultimately strengthens their ability to innovate and compete in the market.

India has become a global leader in hosting GCCs due to its large, skilled workforce. Companies find it more cost-effective to base these operations in India. For multinational companies, GCCs are crucial for driving innovation, maintaining seamless global operations, and ensuring rapid response to market changes. As per Nasscom-Zinnov, over 50% of the world’s GCCs are set up in India providing employment to more than 1.66 million indians.

Here is a quick overview of the GCCs setup in the first quarter of 2024:

From a real estate perspective, the rise of GCCs has dramatically increased the demand for high-quality commercial spaces in major cities.

“30 years ago cheaper real estate and talent was the driver for companies coming to us. Today, companies coming to us for educated talent are the driver for commercial real estate's growth”

Noida is swiftly becoming a prime destination for Global Capability Centres (GCCs)

Since 2022, GCCs have leased over 53 million sqft of commercial space in India as per CBRE Research Aug 2024, with a substantial share in Noida. This surge in demand for office spaces has led to a significant boom in Noida's commercial real estate market. 67% of GCCs are planning to expand their office portfolios by at least 10% in the next two years (CBRE, Office Occupier Survey 2024). This increased demand is driving up rental prices, but it is also encouraging developers to create more premium, future-ready office spaces
significantly shaping the commercial real estate landscape in the region. 

Factors Driving Noida's Appeal for GCCs

1. Strategic Location and Infrastructure

Noida's strategic position, coupled with its well-developed infrastructure, makes it a key player in the GCC landscape. The Noida Expressway and the forthcoming Noida International Airport enhance the region’s connectivity, making it an ideal destination for global firms to set up operations. In particular, the area surrounding the Noida Expressway is experiencing an increasing demand for Grade A office spaces.

2. Cost Advantage and Space Availability

Noida provides a cost-effective alternative to more expensive Indian hubs like Bengaluru and Mumbai. Office rentals in Noida are nearly 50% lower compared to these cities [CBRE Office Occupier Survey].

3. Access to Skilled Talent

Noida boasts access to a large, skilled workforce, especially in technology and business services. The Knowledge Park in Greater Noida produce around 50,000 STEM graduates every year. This pool of talent ensures that GCCs can hire from a deep bench of skilled professionals, making it easier for firms to build their teams locally without compromising on quality.

Emerging Industries to Watch Out in Noida

As per Nascomm research and analytics wing, top three industries that are rapidly emerging in Noida region are:

1. Semiconductors:With the recent announcement of Tarq Semiconductors, Turck Holdings, Vama Sundari and Keynes Semicon collectively  investing ₹80,000 Crore in a semiconductor park of 225 acres near Noida International Airport,  this industry is looking at substantial growth in the region. The focus is on wafer design, chip development, and quality testing, catering to growing demand from AI and automotive industry.
2. Life Sciences Firms: Propelled by medical advancements, along with better compliances and regulatory frameworks. Phrama and Biotechnology is quickly catching up with rest of the GCCs. Novo Nordisk which has over 4000 employees in Indian GCCs and Astrazeneca which is a well known name too have plans to set up in Noida and expand their services.
3. Automotive: Along with the planned Electric Vehicle Park spanning across a significant area in the industrial space. Honda and Maruti Suzuki have well established GCCs in Noida. With the development of Jewar Airport, more companies are bound to look towards Noida for future GCC establishments

Noida’s rise as a hub for Global Capability Centres is a testament to its strategic advantages: affordable, high-quality office spaces, access to a skilled workforce, and strong connectivity. As GCCs continue to expand in Noida, the region’s commercial real estate market is set to witness sustained growth. Modern GCCs now require integrated corporate parks that offer a blend of workspaces and recreational amenities, including F&B outlets, fitness centres, and community event spaces. Take a look at some of these upcoming corporate parks in the region with amazing investment opportunities: