No longer central in the scheme of things

**Haryana is developing 1,000-acre Global City, a mixed land-use township, near the Dwarka Expressway in Gurugram.

**Mumbai is preparing to develop Wadala as a new corporate hub following the success of the Bandra Kurla Complex (BKC).

In major metropolitan areas of India, new hubs for companies are coming up mainly on the outskirts. Bidadi, projected by Karnataka deputy chief minister D K Shivakumar as “the future of Bengaluru”, is 30 km from the city, while Global City, near the Dwarka Expressway, is about 20 km from Delhi’s Indira Gandhi International Airport. Wadala benefits from its proximity to BKC and South Mumbai, but companies in Mumbai are relocating to as far as Thane and Navi Mumbai.

This shift, besides raising concerns about potential urban sprawl, also clouds the future of traditional central business districts, which were once seen as the power centres of city economies.

For example, the once-dominant Connaught Place (CP) and its extension lost their prominence to Gurugram and Noida, both situated in different states, in the post-liberalisation proliferation of multinational firms. The purpose-built BKC overshadowed the historic Fort area and Nariman Point. And Bengaluru’s thriving central business district (CBD) was bypassed by the IT boom in favour of the peripheries.

Abandoning the core

It’s not unusual for cities to have polycentric business districts. Internationally, Paris’ La Défense, London’s Canary Wharf, and New York’s Hudson Yards are successful purpose-built business districts. Yet, traditional CBDs in these cities—the Golden Triangle, the Square Mile, Midtown Manhattan, and the Financial District in Lower Manhattan—have continued to thrive.

But in many Indian cities, jobs are shifting out, and so is the workforce. As a result of this suburbanisation, the core areas of major metropolitan Indian cities have effectively “hollowed out”, suggests Jaya Dhindaw, the executive program director at WRI India, a non-profit.

In Delhi’s CP, it is mostly smaller businesses, professional services firms, and entities that need to liaise with the government that have stayed put, rather than large corporate houses and MNCs, which drive a location’s higher economic value, points out Vibhor Jain, founder & CEO of Carbon Guardians, a firm specialising in design, build and managed offices.

The outward growth caters to companies seeking affordable, larger, and modern office spaces. A recent report by real estate consultancy Knight Frank shows that only 15% of the office stock in the Mumbai Metropolitan Region is concentrated in CBDs, whereas 58% is found in suburban business districts. There is a significant shift from Nariman Point to BKC and Andheri, with Thane and Navi Mumbai in the periphery, where occupiers get modern infrastructure, better scalability, and competitive rents.

In Bengaluru, the peripheral districts of Whitefield, Electronic City, and Bannerghatta Road dominate the office market, accounting for 52% of the office space. The National Capital Region (NCR) still has the highest proportion of office space in CBDs at 44%. However, these are scattered across the landscape—CP, ITO, Pusa Road, and Jhandewalan in Delhi; DLF Cyber City, NH8, and Golf Course Road in Gurugram; and various sectors in Noida.

According to the report, another 41% of NCR’s office stock is concentrated in the suburban districts of Nehru Place, Saket, Jasola, Bhikaji Cama Place, Okhla, and Aerocity in Delhi; Golf Course Extension Road, Udyog Vihar, and Sohna Road in Gurugram; and Noida’s Film City and the Noida-Greater Noida Expressway.

Delhi, Mumbai, Bengaluru

Although strategically located, traditional CBDs often have outdated, cramped office spaces. While all built structures have a finite lifespan, experts say flaws in initial planning and overly restrictive development control regulations (DCRs) have also caused obsolescence.

Delhi’s first master plan of 1962 designated CP as the CBD and initiated the expansion to the adjoining roads. As demand for space increased, a Floor Area Ratio (FAR) of 400 allowed buildings to rise to 20 storeys, marking the emergence of the city’s first high-rises. The late architect Ranjit Sabikhi described this vertical growth as “isolated towers lacking cohesion or a sense of design” in his book, A Sense of Space – The Crisis of Urban Design in India.

On a rethink, the government accepted its expert committee’s advice to lower the FAR to 250. However, it failed to implement a crucial recommendation to build a continuous walkway at the first-floor level to connect all high-rises, wrote Sabikhi. This walkway could have given office-goers safe access to the Metro stations and the retail areas of CP, and alleviated the current chaos caused by cars.

The absence of large floor plates in most of the older office stock is also attributed to the political economy of the time — the inner and outer circles of CP were designed as “neeche dukan and upar makaan (residential units above shops).” The adjoining arterial roads were lined with privately owned bungalows. When the CBD emerged, their owners collaborated with private developers to construct high-rises, and most office space—except for a few buildings—was sold in parcels to multiple investors. With no concept of large floor plates at the time, Indian companies occupied or owned these small office spaces, explains Jain.

In India’s financial capital, the historic Fort area was initially the hub of top firms and banks, with the Reserve Bank of India and the Bombay Stock Exchange continuing to operate from this heritage zone. In the early 20th century, Nariman Point, a CBD built on land reclaimed from the Arabian Sea, came to be known as the Manhattan of India.

But by the mid-90s, when economic liberalisation led to a surge in banking and financial services, older buildings could not adapt. Their existing designs didn’t allow for retrofits for IT infrastructure or even heating, ventilation, and centralised air-conditioning, says veteran urban planner Vidyadhar Phatak.

In South Mumbai, large-scale overhauling was difficult also due to town planning regulations, the heritage tag, and even rent control norms, which protect tenants from eviction and sudden rent hikes, he adds. Also, emerging institutions such as ILFS, NSE and SEBI needed a foothold in Mumbai. The purpose-built BKC emerged as the most suitable alternative for this evolving economy, says Phatak.

In Bengaluru, while the CBD served the early IT industry, the shift to the periphery began in the 1990s, when the state government, in partnership with Ascendas, a Singapore-based firm, set up International Tech Park Bangalore in Whitefield. “This was India’s first large-format, -planned IT office park, with integrated campus-style infrastructure, built-to-spec, plug-and-play tech blocks… centralised facilities management, and sustainable design principles,” says the Knight Frank report, crediting the development to driving decentralisation from CBDs to peripheral business parks.

The pull of the peripheries

Across cities, now there is demand for larger floor plans and campus-style developments that incorporate all amenities and adhere to environmental, social, and governance standards, says Abhinav Joshi, head of research for India, the Middle East, and North Africa at CBRE, a real estate services firm.

He says that one of the main attractions of the newer peripheral districts is the abundance of residential options, preferred by employees who want to live near their workplaces to save time, energy, and money on long commutes. Globally, CBDs are increasingly enabling office-to-residential conversions, particularly after the pandemic.

Also, post-COVID, the shift to hybrid work models, combining work-from-home with office, has altered employee expectations, according to Jain. “When they come to the office, they seek more than just a workspace. They want food and beverage, shopping, and retail options within the business district,” he says. Built as “destinations,” the newer business districts in the city outskirts serve this purpose.

Accommodating such amenities on a scale is tough in traditional CBDs due to the unavailability of large and continuous developable land parcels. Land in the city core is also expensive due to overly restrictive development control norms, says Nithya Ramesh, director of planning and design at the Bengaluru-based Jana Urban Space Foundation.

Vertical growth could maximise the carrying capacity of expensive land. However, the current regulations, characterised by a low Floor Space Index FSI, prevent developers from building higher and discourage investment in core city areas, leading to sprawl, which increases travel and service delivery distances. In Bengaluru, the outer areas have grown seven times faster than the CBD, she says.

Unsurprisingly, most firms prefer the peripheries, especially locations outside the municipal limits, because the cost of land is usually much lower and it is easier to obtain permission from a single entity- like a panchayat to develop on rural land than to navigate the complex approval procedures in the city, points out Dhindaw.

“But even basic amenities here — whether diesel gensets for electricity or water through tankers — are self-provisioned. It’s expensive, but private firms don’t mind because the talent is gathering around these job centres rather than in the city. Although better serviced by infrastructure, the city’s original central business districts, whether Bengaluru’s MG Road, Delhi’s CP, or South Mumbai, are not sufficiently utilised,” she says.

A recent report by Asian Development Bank and World Bank on the creative redevelopment of Indian cities points to unplanned expansion in Delhi, Bengaluru, Thiruvananthapuram, and Jaipur, where high-value core-city areas are underutilised while sprawl is at its maximum. As a result, there’s low mass transit ridership in the core city due to low density. In contrast, in the world’s leading cities such as New York, London, Hong Kong and Tokyo, land is efficiently utilised in core-city areas, is typically of high value, and mass transit is efficiently utilised, with denser networks in these areas.

Space, connectivity

According to the Knight Frank report, 28% of the current office inventory in Indian cities predates 2010, including 24% from 2000–2009 and 3% from before 1999. These legacy buildings, primarily concentrated in prime CBDs and SBDs, are energy-inefficient, physically worn out, and functionally obsolete.

Unlike complete demolition or rebuilding, the upgrades involve “core building systems, common areas, and critical user-experience touchpoints.” The firm estimates that approximately 30% of India’s total office stock, valued at ₹3,439 billion, is ripe for retrofitting.

Experts say upgrading or redeveloping older central business districts (CBDs) is challenging because much of the office space there has been “strata sold” — each floor divided into multiple units or shops owned by different individuals. It is not easy getting these owners to agree on a common plan.

There should be an economic benefit to the developer who takes on this task if the majority owners agree, says Jain, pointing out that such arrangements are working in Mumbai for the redevelopment of residential buildings.

As a policy incentive, Ramesh suggests differential regulations for different growth areas, at least within the million-plus cities. For example, the city centre should have high-rise and high-density development, particularly around Metro stations, not just to maximise land value but to make the city walkable.

The national Transit-Oriented Development policy of 2016-17 promotes this growth pattern. According to the Ministry of Housing and Urban Affairs, 13 states and UTs have notified TOD policies.

Dhindaw says the TOD policy could be more effective if it incorporated incentives for development within the city’s core and disincentives for developing in the periphery. To devise this mechanism, she says, Indian cities could study the “urban growth boundaries” model, for instance, implemented by Portland, USA.

Since 1979, Portland has sought to contain construction and development within its urban growth boundaries, promoting redevelopment in areas with access to mass transit. The boundaries are reviewed every 20 years to account for population and economic changes, with the focus on retaining a compact urban environment and protecting the open spaces and forests on its outskirts.

Price of urban sprawl

In India, though, urban sprawls account for high ecological and social costs, say experts. The township of Bidadi would “swallow up” highly fertile and productive farmland, warns AN Yellappa Reddy, former secretary of the department of ecology, environment, and forest for the Karnataka government. “Even with monetary compensation, it will lead to farmers’ livelihood loss and ultimately force them into low-paying jobs.”

“It will be a futuristic township to promote the AI industry. But will this future have adequate drinking water? Even now, Bengaluru sources it 200 kms away from the city. Or lessen the impact of heatwaves, floods, droughts, and food security, which will likely worsen in the coming years,” he asks.

A study by WRI-India shows that between 2000 and 2015, the built-up area in Bengaluru increased by 76% in the 0-50 km region. It warned that increasing the impermeable built-up area reduces groundwater infiltration, leading to water scarcity and flooding, which the area is already experiencing.

In Gurugram, rapid urbanisation since the 1990s has led to intrusions into the Aravallis, the world’s oldest mountain range and a natural barrier to the Thar Desert. Deforestation, relentless construction, and mining are causing desertification. Encroachments and dumping sewage, silt, and construction waste are obstructing natural drainage systems, says a 2021 report by The Energy and Resources Institute. Additionally, the number of water bodies shrank from 640 in 1956 to 251 in 2018-19.

Reversing the trend

City-centres have their obvious charm and a CP address serving various regulatory purposes is always desirable for any company, argues Jain, suggesting a “tailor-made” redevelopment policy for the central district, similar to the way the Union government developed the Central Vista area with new government office buildings.

“Until now, CP has undergone superficial painting jobs, such as the one during the 2010 Commonwealth Games makeover. The redevelopment must include not just refurbishing the buildings, but also the surrounding ecosystem – transportation links and residential areas in the catchment areas,” he says.

In Bengaluru, point out Ramesh and Dhindaw, PSUs and central government agencies have substantial landholdings. The potential for higher development density around the CBD could be realised if central and state governments collaborate to develop mechanisms for sharing this land.

Though not specifically around the CBD, Mumbai is opening up unused parcels of land. The 2024 Niti Aayog economic master plan for the MMR proposed world-class business districts like Canary Wharf, at Bandra Kurla Complex, Wadala, Kharghar and through the redevelopment of Mumbai Port Trust (MPT) land.

Mumbai Metropolitan Region Development Authority (MMRDA) said in a statement that the state government has been approached to transfer land parcels owned by the MPT and Worli Dairy, as well as the land around the bullet train station, for inclusion in this development.

South Mumbai is also gaining traction. The area is now served by mass transit. This September, the RBI acquired 4.16 acres at Nariman Point from the Mumbai Metro Rail Corporation for ₹3,472 crore. The state also approved a plan to rejuvenate the Backbay Reclamation area. Joshi says some of these “individual developments” could benefit South Mumbai, which retains premium value for the banking, financial services, and insurance sectors. But the cost of redeveloping older assets, especially heritage-listed structures, remains prohibitive.

Dhindaw refers to the Telangana government’s ‘Growth in Dispersal’ (GRID) policy as a potentially replicable model. It aims to promote the spread of the IT and other emerging sectors throughout the city, moving away from its current concentration in the western corridor, primarily around Hitec City and Gachibowli. To address environmental pollution, industrial units are being relocated to Hyderabad’s outskirts, opening up brownfield parcels.

Besides, the central government’s ₹1 lakh-crore Urban Challenge Fund, announced in the 2025-26 Union Budget, includes promoting a category of growth known as creative redevelopment. Dhindaw says this could allow the redevelopment of derelict properties and underutilised lands within city boundaries, enabling sustainable development.

She also pointed out Bengaluru’s recent division into five distinct corporations and the formation of the Greater Bengaluru Authority (GBA) as opportunities to launch urban renewal projects.

“It will definitely make each city region the focus of attention,” says Maheshwar Rao, chief commissioner of the GBA. “Connectivity and land-use will decide how new districts, such as Bidadi, are established and how existing ones are revitalised. Whether people travel to work or live and work in the same place is one of the key questions.”