State Street Leases 2.1 Lakh Sq Ft Office Space in Coimbatore, Signs 10-Year Deal at ₹1.05 Crore Monthly Rent

State Street Corporate Services Delhi Private Limited, a subsidiary of global financial services giant State Street Corporation, has entered into a long-term lease agreement for a substantial 2.1 lakh square feet of office space in Coimbatore, Tamil Nadu. The deal, finalized at a monthly rent of ₹1.05 crore, reflects a growing corporate interest in tier-2 cities across India.

According to documents accessed by data analytics firm Propstack, the lease was signed for a period of 10 years and pertains to four floors located in Tower D of India Land KGISL Tech Park (CHIL SEZ). India Land Techpark Private Limited is listed as the landlord in the transaction.

The lease officially commenced on April 1, 2025, with the space priced at ₹50 per square foot per month. The agreement includes a structured rent escalation plan: a 3% hike in February 2026, followed by 5% annual increases from the following year onward. The company also paid a security deposit of ₹7.36 crore, as stipulated in the lease agreement.

This move by State Street, a Fortune 500 company with operations worldwide, signals a notable expansion of its footprint in India beyond the metro cities. It also underscores the rising significance of cities like Coimbatore in India’s commercial real estate landscape.

Industry experts suggest that this leasing decision aligns with a broader trend wherein Information Technology (IT) and IT-enabled Services (ITeS) firms are increasingly setting up or expanding operations in tier-2 cities. Factors such as lower real estate and operational costs, availability of a skilled workforce, infrastructure upgrades, and supportive government policies have made these cities attractive destinations for corporate tenants.

"This deal not only highlights Coimbatore's growing prominence as a business hub but also shows that multinational corporations are actively seeking cost-effective yet well-connected locations for long-term operations," said a senior analyst from Propstack. He added that this kind of large-scale transaction demonstrates confidence in the region’s commercial viability.

This leasing deal is part of a broader trend in Tamil Nadu's commercial real estate sector. In March 2025, Tata Consultancy Services (TCS) leased 6.3 lakh sq ft of office space in Chennai’s Ozone Techno Park for a monthly rent of ₹2.8 crore. Similarly, Walmart secured 4.6 lakh sq ft in International Tech Park, Chennai, in January 2025, paying ₹3.26 crore per month and depositing ₹19.55 crore.

In an earlier transaction in August 2024, LTI Mindtree had leased 5.85 lakh sq ft in Manapakkam, Chennai, with a monthly rental starting at ₹3.98 crore. These deals collectively reinforce Tamil Nadu’s increasing appeal among global and domestic companies alike.

A recent report by real estate consultancy ANAROCK further underscores the shift in India’s leasing patterns. According to the report, South Indian cities have outpaced others in commercial leasing growth. Between 2019 and 2024, Bengaluru saw a 26% increase in office rentals, followed closely by Hyderabad (25%) and Chennai (20%). In contrast, Delhi-NCR recorded a modest 10% rise during the same period.

From a national perspective, the report notes that 283.21 million sq ft of office space was added across India’s top seven cities over six years, with 2022 marking the highest annual supply addition of 57.75 million sq ft. Of this, South Indian cities contributed nearly 172.96 million sq ft, accounting for 61% of the total supply.

This continued momentum suggests a significant decentralization of India’s office space demand. With rising rentals and congestion in tier-1 cities, corporates are increasingly adopting a "hub-and-spoke" model, where major functions remain in metros, but a considerable portion of operations are shifted to more affordable and scalable locations like Coimbatore.

Image source- properties.cityinfoservices.com