Shortage of Grade A office space turns a stumbling block for Hi-Tec City area in Hyderabad
Hyderabad: When Dutch giant Heineken zeroed in on Hyderabad for its global capability centre (GCC) with plans to pour in nearly Rs 3,000 crore, it perhaps did not anticipate that finding space in the heart of the IT hub of HITEC City would be akin to a mission impossible.
The reason is that this swanky, most sought-after destination for GCCs, which has many a global CEO raving about its international ambience a la San Francisco's famed Bay Area, is practically all sold out (read leased out) in terms of Grade A space, realty sources said.
HITEC City houses Sattva Group's Knowledge Park and Knowledge City, RMZ's Nexity, Raheja Mindspace, and CapitaLand Park, in addition to standalone projects by Auro Realty and My Home Group, among others.
Among the last to grab a big chunk of space in a premium park here was McDonald's, which secured around 2 lakh sq ft over six months ago, while Eli Lilly opted for a standalone building near IKEA for a similar space as parks housing most pharma and healthcare GCCs were all leased out, sources said.
'There is nothing available. No new supply will be available in HITEC City before the end of 2026. GCCs now have no choice but to explore standalone options on HITEC City's periphery or Financial District (FD) and Gachibowli,' said Sreekanth Reddy, managing director-Hyderabad, Cushman & Wakefield.
HITEC City houses around 55 million sq ft of Hyderabad's total 75 million sq ft Grade A space, he added.
'There is some little inventory here and there, but most of the big ones are taken due to huge demand from GCCs as HITEC City has emerged as the first choice for GCCs coming to India,' said Karan Chopra, chairman & co-CEO, Table Space.
This unprecedented demand has sent rentals in what was earlier known as a sub-dollar market to triple digits.
'Rentals in HITEC City have breached the Rs 100 per sq ft mark because of the absorption surge,' confirmed Shrinivas Rao, CEO, Vestian.
According to Vimal Nadar, national director & head of research, Colliers India, HITEC City accounted for 57% of Hyderabad's cumulative office leasing over last five years, with Grade A leasing surging 5X compared to 2020, driven by expansion of MNCs and tech giants.
Elaborating on factors driving this demand surge, Rao said: 'Of every 10 enquiries, Hyderabad accounts for four, showing it's right up there in the GCC world.
Hyderabad and HITEC City's biggest advantage is world-class infrastructure compared to other cities and shorter commute times.'
The Metro Rail project has also emerged as a key driver of HITEC City's appeal for GCCs, said Reddy.
Agreeing, Nadar said improved connectivity thanks to Raidurg-Nagole Metro Line 3 has played a crucial role in elevating HITEC City's commercial appeal. Realtors said the good airport connectivity as well as great social infrastructure too add to its appeal.
This has also given rise to a paradoxical situation — recent market studies pegged Hyderabad as the market with the highest vacant Grade A stock among top cities in India. 'Though there is a huge amount of Grade A space available in Hyderabad but its all sitting in FD and Gachibowli,' Rao explained.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
India Gazette
28 minutes ago
- India Gazette
Funds not a constraint, only speed of execution is the issue: Nitin Gadkari
Pune (Maharashtra) [India], June 24 (ANI): Union Minister for Road Transport and Highways, Nitin Gadkari, on Monday emphasised the government's strong financial standing and the urgent need to accelerate infrastructure project execution. Speaking at the Punyabhushan Award ceremony in Pune, he also took aim at the lack of out-of-the-box thinking within the administration. 'There is no shortage of funds. I often make announcements worth Rs 1 lakh crore to Rs 50,000 crore. People especially journalists find it hard to believe such figures. I tell them to write down every word, and if even one project doesn't happen, they can run it as breaking news. But today, the problem isn't funding it's the lack of speed in execution,' Gadkari said. He explained that innovative financial models have enabled infrastructure investments far beyond annual budgetary allocations. 'Though the budget is Rs 2 lakh crore, I can manage to spend Rs 8 to Rs 10 lakh crore,' he said, highlighting the Indian economy's dynamic and growth-oriented approach. Gadkari criticised the rigid functioning of the administration system, likening it to rural animal behaviour. 'In villages, when animals move out to graze, they walk in a disciplined straight line. Similarly, our administrative system functions in a rigid, linear way. If someone suggests an out-of-the-box idea, it's often dismissed outright as 'not possible',' he said. Recalling a significant conversation with the then Finance Commission chairman, Gadkari said that 406 projects worth Rs 3.85 lakh crore were stuck with banks and risked becoming non-performing assets (NPAs). 'The issue wasn't money--it was land acquisition delays, pending utility shifting, lack of railway and environmental clearances, and legal cases. These systemic blockages pushed major companies towards bankruptcy,' he said. The minister further explained how the government intervened. 'We sat together, assessed the projects, and terminated Rs 40,000 crore worth of unviable ones. We revived others and prevented Rs 3 lakh crore worth of NPAs, saving banks and the economy from a major crisis,' he said. He credited Vijay Kelkar, former bureaucrat and economist, for introducing impactful reforms. 'Kelkar Sahab was open to new ideas. He accepted what was reasonable, rejected what was not, and corrected policies accordingly. His goal was always clear India's economic growth and development.' Concluding his speech, Gadkari stressed that policy-making is crucial for progress and praised administrative officers who drive systemic change. 'Without reform-oriented leadership, even the most capable officials get frustrated. Kelkar's legacy reminds us that governance must be agile, not rigid,' he said. (ANI)
Time of India
an hour ago
- Time of India
Wipro revises capital allocation policy
1 2 3 Bengaluru: Effective this fiscal, Wipro has revised its capital allocation policy. The company expects to return 70% or more of the net income cumulatively over a three-year period through a combination of dividends, special dividends, or share buyback. Its capital allocation policy targeted a minimum payout of 45%–50% of net income for a period of the trailing three years. "Effective FY26, we have revised our minimum committed payout to 70% of net income, calculated cumulatively over three years. A 1:1 bonus issue in Q2 and an interim dividend of Rs 6 per share in Q3 underscore our commitment to enhanced shareholder returns," Wipro chairman Rishad Premji wrote in the letter to shareholders published in the 2024-25 annual report. TOI reported that Premji's remuneration rose by 109% to $1.6 million during the 2024-25 fiscal year, according to a US regulatory filing. The considerable increase stemmed primarily from a rise in commission payments. Premji is entitled to a commission at the rate of 0.35% on the incremental net profit of the company over the previous fiscal year. Wipro saw a decrease of 0.6% in the aggregate remuneration of employees at Wipro, as shown in the firm's annual report. Wipro added a meagre 732 during the year with a heavy net reduction of 1,157 in the December quarter. "The aggregate remuneration of employees excluding whole-time directors decreased by 0.6% over the previous financial year, attributed to a decrease in headcount," it said. The median remuneration of employees (MRE) excluding whole-time directors was Rs 9.7 lakh and Rs 9.8 lakh in the financial year 2024-25 and 2023-24 respectively. The CEO pay ratio to employees stands at 548:1. Premji said that Wipro turns 80 in December, a rare milestone in any industry. "For nearly 50 years, we have been in the technology business—navigating disruption through continuous innovation, deep client trust, an adaptable culture, and a long-term mindset," he said. On the roadmap ahead, Premji said the external environment may remain uncertain. "But durable businesses are built in cycles like these. We have used this time wisely—investing in our people, deepening client impact, and staying anchored in purpose. Wipro's 80-year journey has never been about short bursts of success. It's about long-term stewardship, continuous reinvention, and doing business the right way."
Time of India
an hour ago
- Time of India
Technical sanction pending, Thanal project faces delay
T'puram: The ambitious Thanal Housing Project, aimed at rehabilitating residents of the decades-old Vikalanga Colony at Muttathara, faces a prolonged delay as it awaits crucial technical sanction from the local self-govt department (LSGD). Despite groundwork preparation and the selection of a contractor, construction is yet to begin. Technical sanction for the revised project estimate, which exceeds Rs 2.5 crore, has been delayed. According to regulations, any project costing more than Rs 2.5 crore requires mandatory approval from LSGD's chief engineer. Though the city corporation submitted its proposal earlier this year, the inclusion of the outdated 2018 Delhi Schedule of Rates (DSR) prompted the need for revisions. The project's total cost is Rs 20 crore. "With the DSR revised this year, the project estimate must be updated accordingly. We are in the process of revising the proposal and will resubmit it shortly," a senior corporation official told TOI. "This is a critical step to ensure cost accuracy and avoid hurdles during execution," the official said. To expedite the process, mayor Arya Rajendran met with the LSGD chief engineer last week. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Trading CFD dengan Teknologi dan Kecepatan Lebih Baik IC Markets Pelajari Undo Sources said the engineer assured the mayor that the sanction would be granted within 10 days. Despite awarding the construction contract to Uralungal Labour Contract Co-operative Society (ULCCS) last year, the project has not seen any major activity on site. ULCCS representatives said foundation work can begin once technical sanction is received. "The cost is likely to increase slightly with the updated DSR," said a ULCCS official. Currently, 99 families, many of whom are persons with disabilities, reside in Vikalanga Colony in extremely challenging conditions. An anganwadi also operates in the area, highlighting the urgent need for new housing infrastructure. The colony, established nearly 48 years ago, earned its name because its population primarily comprised individuals with disabilities. The Thanal project plans to construct a two-storey residential complex across two acres originally designated for rehabilitating fishermen affected by sea erosion. Each of the 136 apartments will have 550 sq ft of living space, with four houses in each block. Initially, the project was designed as a three-storey structure, but height restrictions imposed by the Airport Authority of India (AAI) forced the civic body to downscale it. A senior corporation official, however, stated: "This project remains a top priority for the corporation. We are pushing for quick approval and expect construction to begin soon after sanction is received," he said. Once started, the project is expected to be completed within 18 months. Thanal project is an initiative aimed at providing housing to vulnerable communities, specifically flood victims and fishermen affected by sea erosion. The state govt incorporated Vikalanga Colony into it.
