Leased out: Heineken, MNCs face space crunch; shortage of office space turns into a stumbling block for HITEC City
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, say realty sources.
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.
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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.
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