Tech giant Infosys Limited has signed a significant 10-year lease for 1.03 lakh sq ft office space in Gujarat International Finance Tec-City (GIFT City), highlighting the city’s rising stature as a key IT and financial services hub. With a monthly rent of ₹57.26 lakh, this expansion is set to bolster the commercial real estate market in GIFT City, attracting more global and domestic investors to India’s premier International Financial Services Centre (IFSC).
Infosys’ Strategic Expansion in GIFT City
Infosys has leased contiguous floors 14 to 17 in the PRAGYA-2 building in Gandhinagar, designed to accommodate up to 1,000 employees. The lease agreement, effective from October 2024, is priced at ₹55 per sq ft per month on the chargeable area and ₹108 per sq ft on the carpet area (53,020 sq ft). The contract includes a 5% annual rent escalation and a three-year lock-in period, with a security deposit of ₹3.43 crore paid to Savvy Realty Creators LLP.
The lease provides 71 dedicated parking slots, with additional spaces available at ₹2,000 per slot monthly. The office officially opened on June 7 and will serve as a TechFin hub focused on advanced digital solutions for global BFSI clients, covering digital banking, regulatory affairs, capital markets, and risk management.
About GIFT City: India’s First International Financial Services Centre
Situated between Ahmedabad and Gandhinagar, GIFT City spans 880 acres along the Sabarmati River. The city is divided into two zones:
- Special Economic Zone (SEZ): For export-oriented businesses, currently boasting a low vacancy rate of 1.46% in Grade A commercial spaces.
- Domestic Area: Supports residential and commercial activity with ongoing development.
About 30% of GIFT City is operational, with significant new commercial and residential developments underway. Experts highlight that rental rates for Grade A buildings are trending upwards, now exceeding ₹70 per sq ft per month in the SEZ.
Real Estate Market Impact and Investment Outlook
Real estate analysts project that the Infosys lease will further strengthen GIFT City’s commercial real estate ecosystem, which already includes global financial and IT giants like Cognizant, Accenture, Wipro, and JP Morgan. Residential developments make up about 23% of the city’s total construction allocation.
Investors can expect returns of 7% to 8%, supported by favorable tax exemptions unique to IFSC operations, including no GST on certain services and exemptions from securities transaction taxes.
Key Quotes
“Setting up our Development Centre in GIFT City is a strategic step aligned with our vision of leading innovation in financial services from within India’s foremost international financial hub,” said Jayesh Sanghrajka, CFO of Infosys.
“The SEZ micro-market in GIFT City has minimal vacancy and strong net absorption, with rentals for Grade A buildings reaching new highs,” noted Samantak Das, Executive Director, JLL India.
“GIFT City presents a promising opportunity for investors due to its unique financial incentives and rapid development trajectory,” added Rumit Parikh, Senior Director at Knight Frank India.
Summary Table: Infosys Lease at GIFT City
| Parameter | Details |
|---|---|
| Leased Area | 1.03 lakh sq ft (Chargeable area) |
| Carpet Area | 53,020 sq ft |
| Monthly Rent | ₹57.26 lakh |
| Rent per sq ft (Chargeable) | ₹55 per sq ft |
| Rent per sq ft (Carpet) | ₹108 per sq ft |
| Lease Tenure | 10 years |
| Rent Escalation | 5% annually |
| Security Deposit | ₹3.43 crore |
| Dedicated Parking Slots | 71 (Additional slots @ ₹2,000 each) |
| Lock-in Period | 3 years |
| Location | PRAGYA-2 Building, GIFT City, Gandhinagar |
FAQ Section
Q1: What is the size of the office space Infosys leased in GIFT City?
A: Infosys leased 1.03 lakh sq ft of chargeable area, spanning four floors in the PRAGYA-2 building.
Q2: How long is the lease agreement between Infosys and the landlord?
A: The lease is for a duration of 10 years, starting from October 2024.
Q3: What is the monthly rent Infosys is paying?
A: Infosys is paying ₹57.26 lakh per month for the leased office space.
Q4: What are some benefits of investing in GIFT City real estate?
A: Investors benefit from high rental returns (7-8%), low vacancy rates, rapid development, and tax exemptions on GST, STT, and stamp duty for transactions within the IFSC.
Q5: What industries will Infosys’ new office space in GIFT City focus on?
A: The office will focus on TechFin solutions for BFSI sectors, including digital banking, trade finance, capital markets, regulatory affairs, and risk management.