Tier II Cities Emerge as Strategic Hubs for Global Capability Centres: Insights from CBRE's Anshuman Magazine
CBRE's Anshuman Magazine discusses the growing popularity of Tier II cities such as Coimbatore, Jaipur, and Vizag as strategic hubs for global capability centres (GCCs). He highlights the cost advantages, sustainable infrastructure, and government incentives that are driving this trend.
Global Capability CentresTier Ii CitiesCommercial Real EstateEsgGreen BuildingsReal Estate PuneJun 24, 2025
Which Indian cities do you see as emerging hotspots for GCCs beyond the established hubs?
Beyond the established GCC hubs of Bengaluru, Hyderabad, and Pune, Delhi-NCR, Mumbai, and Chennai are rapidly evolving as GCC hotspots. Delhi-NCR is attracting more GCCs due to its diverse ecosystem and broad talent pool. Mumbai continues to attract enterprises from the BFSI sector due to its financial prominence. Chennai, on the other hand, offers a compelling mix of IT expertise and industrial capabilities. Importantly, Tier II cities such as Coimbatore, Jaipur, Vizag, Kochi, and Indore are emerging as viable alternatives within a hub-and-spoke model for GCCs. These regions offer a reasonable real estate cost, lower than Tier I cities, and supportive state government incentives.
How has demand for commercial real estate changed with the rise of Tier II GCC locations like Coimbatore, Jaipur, and Vizag?
Businesses are increasingly turning to these locations as cost-effective alternatives to Tier I metros. This shift is prompting developers to respond with high-quality commercial assets, including a rising share of green-certified buildings. Notably, the majority of new office stock delivered during Jan-Mar 2025 is green-certified, reflecting both occupier demand for sustainable infrastructure and developers’ alignment with ESG goals. While cities like Bengaluru, Mumbai, and Delhi-NCR continue to lead in overall office space consumption, Tier II markets are gaining strategic relevance within the hub-and-spoke models increasingly adopted by multinational firms. These locations offer cost advantages, flexibility for future expansion, operational resilience, and workforce diversification.
What key infrastructure factors do clients prioritise while finalising GCC locations in India?
Clients are increasingly prioritising future-ready, sustainable office spaces, which aligns with their growing commitment to ESG. The availability of a skilled talent pool is another key consideration, facilitating efficient hiring and long-term workforce development. Additionally, physical connectivity—especially easy access to airports and well-developed transportation networks—along with robust digital infrastructure, such as high-speed internet and a reliable power supply, is seen as an essential prerequisite. Beyond physical assets, the maturity of the local business ecosystem plays a significant role. Government incentives and favourable regulatory frameworks further influence site selection decisions.
How do real estate costs for GCCs in Tier 2 cities compare with Tier 1 hubs today?
Cost advantage is a key factor driving the growing popularity of GCCs in emerging locations such as Coimbatore, Jaipur, Vizag, Kochi, and Indore. These destinations offer not only more affordable leasing rates but also access to skilled and cost-efficient talent pools, contributing to reduced operating expenses and improved talent retention. The rising availability of Grade A and ESG-certified office spaces in these smaller markets further enhances their appeal for sustainable GCC operations.
How are ESG and green building mandates shaping GCC real estate preferences?
The environmental, social, and governance (ESG) principle is foundational to real estate decision-making among GCCs in India. Data indicates that the majority of new office completions and leasing activity occurred in green-certified buildings, reflecting a strong and growing preference for sustainable infrastructure. GCCs—particularly in sectors such as technology and BFSI—are at the forefront of this transition, actively seeking properties that comply with internationally recognised standards like LEED (Leadership in Energy and Environmental Design-India), IGBC (Indian Green Building Council), and GRIHA (Green Rating for Integrated Habitat Assessment).
Frequently Asked Questions
What are global capability centres (GCCs)?
Global capability centres (GCCs) are offshore locations where companies set up operations to leverage cost advantages, access talent, and enhance operational efficiency. They often focus on research and development, IT, and business process outsourcing.
Which Tier II cities are emerging as GCC hotspots?
Tier II cities such as Coimbatore, Jaipur, Vizag, Kochi, and Indore are emerging as GCC hotspots due to their cost advantages, skilled talent pools, and supportive government incentives.
Why are developers focusing on green-certified buildings in Tier II cities?
Developers are focusing on green-certified buildings to meet the growing demand for sustainable infrastructure among GCCs and to align with ESG goals. These buildings offer cost savings, improved occupant health, and environmental benefits.
What are the key infrastructure factors clients consider when choosing GCC locations?
Key infrastructure factors include the availability of a skilled talent pool, physical connectivity (airports, transportation networks), robust digital infrastructure (high-speed internet, reliable power supply), and a mature local business ecosystem.
How do real estate costs in Tier II cities compare to Tier I cities?
Real estate costs in Tier II cities are generally more affordable compared to Tier I cities. This cost advantage, along with access to skilled talent pools, makes Tier II cities attractive for GCCs.
Related News Articles
Mumbai's Luxury Real Estate Market Soars: Ashar Group Sells Triplex Apartment for Rs 172 Crore
Ashar Group sets a new benchmark in Mumbai's real estate market with the sale of a luxury triplex apartment to Apco Infratech for a whopping Rs 172 crore.
Sebi Faces Challenges in Recovering Dues Worth Rs 76,293 Crore
The regulator has formed an advisory committee to focus on capital formation through real estate investment trusts (Reits) and infrastructure investment trusts (Invits) along with municipal bonds.
Revolutionizing UAE's Real Estate Sector: BNW Developments and ANACITY Launch BNW LIVING
16th Sept 2024 Dubai | Bengaluru, India - BNW Developments partners with ANACITY to launch BNW LIVING, a mobile-first customer experience platform for UAE's real estate sector.
Should Air Quality Impact Property Prices? Nithin Kamath's Innovative Proposal
Nithin Kamath, co-founder of Zerodha, has proposed a bold idea that could revolutionize the real estate market. His suggestion to link property prices to air quality levels aims to improve environmental outcomes in cities like Delhi, Mumbai, and Bengaluru
Mumbai Leads the Luxury Housing Boom in India
Recent data from CREDAI-MCHI reveals a significant 18% increase in total sales value across India’s top seven property markets, highlighting the growing demand for luxury properties.
Mumbai Porsche Crash: CCTV Footage Reveals Teen’s Reckless Driving in Bandra
Mumbai: A case of reckless driving has been registered by the Mumbai Police following a high-speed collision involving a Porsche driven by a teenage son of a prominent real estate businessman. The incident occurred in Bandra, and CCTV footage has captured