BFSI steered GCC-centric transactions in Chennai in 2023: Knight Frank India

CHENNAI: The burgeoning trend of Global Capacity Centres (GCC) focused transactions in Chennai’s commercial realty market has taken centre stage with the city recording a remarkable surge in GCC-oriented office transactions during 2023, totalling 6.02 mn sq ft across 71 deals, as per a study by Knight Frank India.

This staggering figure represents a substantial 176% year-on-year (YoY) increase, signifying the city’s growing prominence as a preferred destination for GCC operations. Of all the GCC deals observed across eight major commercial markets in India during 2023, Chennai accounted for a significant 29 per cent, further solidifying its position in the GCC landscape. This momentum marks a significant leap from the 57 deals recorded in 2022, totalling 2.18 mn sq ft.

Delving deeper into industry-wise transactions, the report highlights the BFSI (Banking, Financial Services, and Insurance) segment as the frontrunner in GCC-oriented office space transactions. Despite only 6 deals throughout the year, the BFSI sector contributed over 30 pc of GCC transactions in Chennai, leasing a substantial 1.89 million square feet in 2023. Following closely, the manufacturing sector emerged as the second-largest occupier of GCC business-oriented office space in Chennai’s commercial market, with transactions totalling 1.78 mn sq ft in 2023. Also, other service sectors recorded 26 GCC-oriented deals, representing the highest number of transactions during the same period. These findings underscore Chennai’s growing appeal as a hub for GCC operations, with diverse sectors actively participating in the city’s dynamic commercial real estate landscape.

In Q4 2023, Chennai saw a significant surge in office transaction volume, with a total of 3.3 mn sq ft from 29 deals. This was noteworthy, as over half of the GCC business-oriented transactions for the entire year were recorded in this quarter.