Hyderabad has become the most expensive office market for Global Capability Centres (GCCs), with the city leading the Q1 2026 GCC-CPRI index. Global firms are paying a 15% premium for prime space, driving rental growth in the region. This trend highlights the critical role of GCCs in shaping demand for high-quality commercial office space across India's key technology hubs.
What Happened
Hyderabad has emerged as the most expensive office market for Global Capability Centres (GCCs) in India during the first quarter of 2026. According to the GCC Commercial Property Rental Index (GCC-CPRI), released by IIM Bangalore and CRE Matrix, Hyderabad secured the top position with an index score of 212.1. This performance places the city ahead of other major hubs like Pune, which scored 210.7, and Bengaluru, which recorded 190. The findings indicate that multinational corporations are currently paying a 15% premium for office space in Hyderabad compared to non-GCC tenants, driven by strong demand from the technology, pharmaceutical, and financial services sectors.
The Rental Landscape
Data from the same period reflects a consistent rise in office costs within the city. The average stock-weighted rent for office space in Hyderabad grew by 11.6% year-on-year to reach Rs 92.2 per square foot per month. In prime micro-markets such as Madhapur, rents were notably higher, averaging Rs 105.5 per square foot per month. This upward pressure on rental prices is largely attributed to a shortage of high-quality, Grade A office spaces coupled with sustained interest from large corporate occupiers who require specific building standards.
Hyderabad Vs Peer Markets
While Hyderabad holds the highest index score, other markets show different dynamics. Pune recorded the highest rental premium, with GCC occupiers paying approximately 21% more than other tenants for similar office properties. Meanwhile, Bengaluru remains the largest market by total scale, though its rental growth has been more moderate, with a three-year growth rate of 1.6%. The GCC-CPRI index, which synthesizes data from approximately 1 billion square feet of office space, provides a benchmark for understanding how these specific tenants influence commercial property valuations.
Why GCC Demand Matters
For the commercial real estate sector, GCCs represent a distinct category of tenants. These firms typically sign longer-term contracts, lease larger floor plates, and demand higher building specifications than standard office occupiers. This stability makes them a preferred tenant base for real estate developers and REITs. When cities like Hyderabad see a surge in GCC-driven demand, it often supports better rental yield and lower vacancy rates for developers focused on prime, modern office buildings.
What Investors May Track
Investors interested in the commercial real estate space may monitor how these rental trends impact the profitability of major developers and office-focused REITs with significant exposure to Hyderabad. Key monitorables include future rental renewal cycles, the supply pipeline of new Grade A office space, and whether the 15% premium currently commanded in Hyderabad remains sustainable if global economic conditions shift. Additionally, the ability of developers to maintain high occupancy levels in these premium buildings will be essential for sustaining long-term rental growth.