Bengaluru Retains Top GCC Spot as Rental Growth Slows Due to Abundant Supply
Bengaluru continues to be India's largest hub for Global Capability Centres (GCCs), but the city's commercial rental market is showing signs of maturity, with slower growth compared to emerging markets like Hyderabad and Pune, according to a new index by IIM Bangalore and CRE Matrix.
The Global Capability Centre Commercial Property Rental Index (GCC-CPRI) for the first quarter of calendar year 2026 shows Bengaluru's index at 190, reflecting a compound annual growth rate of just 1.6% over the past three years. In contrast, Hyderabad topped the ranking with a CPRI of 212.1, followed by Pune at second place. Hyderabad recorded a year-on-year growth of 5.4%, while Bengaluru saw a decline of 2.7%.
Experts attribute Bengaluru's slow rental growth to a 'problem of plenty' — a large supply of Grade A/A+ office spaces that gives tenants ample options, limiting price increases. 'As supply increases in mature markets like Bengaluru, there are many options available, making it hard for rental growth to happen rapidly. In smaller markets with limited supply and high demand, prices rise quickly,' explained Venkatesh Panchapagesan, professor of finance at IIM Bangalore and chairperson of its Real Estate Research Initiative.
Despite the slowdown, Bengaluru remains India's largest GCC market by stock, housing about one-third of the country's Grade A/A+ office space. Within the city, the Outer Ring Road (ORR) emerged as the strongest macro-market, accounting for 82% of GCC leasing in Q1 CY2026. Whitefield recorded the most consistent growth with an 18% three-year CAGR.
The index also highlights that GCCs in Bengaluru pay a premium over market rents. 'Bengaluru continues to be attractive, with GCC demand so high relative to non-GCC demand that tenants are willing to pay a premium. In Q1 CY2026, Bengaluru recorded a +50% market rent premium, the highest in the quarter,' noted Abhishek Kiran Gupta, co-founder and CEO of CRE Matrix. However, Hyderabad has consistently maintained a 15% premium over several quarters.
The GCC-CPRI, launched in 2024, is India's first scientific model-based index measuring rental trends in the commercial office market, specifically isolating GCC leasing behaviour. The data underscores Bengaluru's enduring appeal as a GCC destination, even as its rental market stabilises.
