Manufacturing emerges as new growth engine for India’s GCC office demand

India’s Global Capability Centre (GCC) story is broadening beyond its traditional technology and banking base, with manufacturing companies emerging as a significant driver of office demand as multinational corporations increasingly shift engineering, product development and innovation functions to the country.

Manufacturing companies were among the fastest-growing occupiers within the GCC segment during the first half of 2026, alongside technology and BFSI firms. The expansion also saw new entrants from sectors such as retail, logistics, infrastructure and aerospace, highlighting a diversification of India’s GCC ecosystem.

The shift comes as GCCs leased 15.8 million sq ft of office space during the January-June period, accounting for 41.7% of total office leasing across the country’s top seven cities, showed JLL India data. Leasing by GCCs rose 14.2% from a year earlier despite a moderation in overall office transactions, reinforcing their position as the biggest demand driver for Grade A office assets.

“There's a fundamental transformation we are witnessing in India's office market; and Global Capability Centres (GCCs) seem to be driving this. As GCCs continue to leverage our skilled talent in AI, data science, and digital engineering to build products, analytics platforms, and drive innovation, we are witnessing unprecedented expansion from BFSI and manufacturing sectors, alongside new entrants from Retail, Logistics, Infrastructure, and Aerospace domains,” said Radha Dhir, CEO, India, JLL.

Multinational manufacturers are increasingly using India not only for back-office operations but also for high-value functions including product engineering, research and development, artificial intelligence, data science and digital engineering. This evolution is driving demand for larger, high-quality office campuses in established technology hubs.

“The GCC landscape is broadening, with manufacturing emerging alongside technology and BFSI as a key occupier segment. Companies are increasingly using their India centres for product ownership, engineering and innovation rather than conventional back-office functions. This diversification is expected to broaden the office demand base as more global companies establish and expand capability centres across a wider range of industries,” said Vinod Rohira, MD & CEO, K Raheja Corp.

The broader GCC ecosystem is expected to continue expanding through the year, supported by new multinational entrants and ongoing expansion plans by existing occupiers. JLL expects GCC leasing in 2026 to match or even surpass last year’s record levels as discussions for new office transactions continue across major cities.

The trend is also reshaping the country’s office market. While overall gross leasing declined 3.9% year-on-year to 37.9 million sq ft in the first half amid geopolitical uncertainty and AI-led portfolio optimisation by global companies, GCC demand remained resilient enough to keep office vacancy at a five-year low of 14.5%.

The consultant said India’s structural advantages, including its engineering talent, cost competitiveness and mature office market, continue to make it the preferred destination for global companies consolidating innovation and product ownership functions.

With manufacturing joining the next wave of GCC expansion, the country’s office market is expected to draw demand from a wider range of industries, reducing its historical dependence on technology companies and creating a broader base for future commercial real estate growth.