The number of Global Capability Centres (GCCs) around the world is set to rise, according to Savills, as more companies look to them as strategic solution to talent shortages, increasing innovation, and reducing overheads, with office costs for a GCC averaging US$25 per sq ft, approximately 75% lower than in major global cities. India, the world’s leading GCC location with over 1,700 centres employing 1.9 million professionals, has average office costs of US$16 per sq ft.

GCCs are branches of multinational companies, established to perform functions such as IT, finance and accounting, HR, R&D, and customer support, on behalf of colleagues abroad (unlike outsourcing, GCCs are fully owned and operated by the parent company and integrated in terms of strategy and culture).

According to a recent survey of corporate occupiers by Savills and CoreNet, 49% of respondents are currently researching and planning GCCs, with half of these expecting to open their first GCC within the next five years. Of those which already have a GCC, 44% said they’re planning to expand into new locations, while 26% are looking to advance the functions of their GCC(s).

Southeast Asia gains momentum
Beyond India, Southeast Asia is emerging as an increasingly attractive region for GCCs, offering competitive real estate costs*.

• Kuala Lumpur: Office costs average US$22.50 per sq ft per annum, among the lowest in the region.
• Manila: Office costs stand at US$27.30.
• Jakarta: Office costs are US$28.
• Ho Chi Minh City: While higher at US$35.67, costs remain well below major global cities.

By comparison, Shanghai’s US$27 office cost places it in line with Manila and Jakarta, while Beijing’s US$42.90 makes it one of the more expensive global GCC destinations. (See Chart)

Paul Tostevin, Director, Savills World Research, comments: “The popularity of GCCs is increasing globally against a backdrop of historically low unemployment in many economies, exacerbated by structural challenges. At the same time, rapid technological change is reshaping the skills landscape, intensifying the pressure on businesses to find new ways to access and retain talent. By tapping into global talent pools, companies can access the skills they need to grow and innovate. The GCC model is increasingly seen not just as a cost-saving measure, but as a way to build resilience and future-proof operations.”

In addition to low real estate costs, government support often plays a pivotal role in GCC growth. In India, this has helped the country become the world’s largest GCC hub, with Bengaluru the single biggest centre, followed by Hyderabad, Pune, Chennai, Delhi-NCR, and Mumbai. Collectively, these six cities have seen office take-up of 130 million sq ft in the last five years.

Savills says that in Europe, GCCs are focused in Poland (primarily in Warsaw, Kraków, Wrocław, and Tricity), the Czech Republic, Hungary, Romania, the Baltics, and Portugal. In the Americas, Mexico is a strategic choice for US firms due to time zones, alongside Argentina, Chile, Colombia, and Brazil. GCCs seek high-quality real estate, in well-connected CBD locations or business parks, ideally with good access to infrastructure, plentiful talent and mid-market housing for employees. Sustainability is increasingly a differentiator, aligning with the values of talent seeking purpose-driven employers.

Read Savills analysis in more detail here.