Bengaluru, along with Singapore and Shenzhen, figure in the list of best locations for tech enterprises in Asia. A research report ‘Top Locations in Asia: Technology Sector,’ released by Colliers Research and based on a comprehensive study of 16 cities in developed and emerging markets across Asia, examines nearly 50 criteria across a spectrum of socio-economic, property and human factors to determine the viability of these cities as tech hubs, as a workability index for the tech sector.

The report recommends the best urban locations for technology firms. Bengaluru, Singapore and Shenzhen stand out as top choices for starting or expanding technology operations in Asia. Modest long-run growth prospects hold down developed cities such as Tokyo and Taipei, for the sector.

While emerging cities offer high growth potential and low operating costs, they tend to score lower on employment criteria and human aspirational metrics.

Highest quantum of start-up

“Popularly known as the Silicon Valley of India, Bengaluru has been chosen as the No 1 choice in Asia for technology occupiers. Bengaluru’s top ranking is based on its socio-economic strengths, making it among the fastest-growing cities in Asia, with an average predicted annual GDP growth of 9.6 per cent till 2022.

Further, it benefits from a wide and experienced talent pool. The city has the largest number of higher education institutions across India relative to its population, with an employability ratio of 24 per cent for the IT sector. As the natural hub for technology start-ups, Bengaluru has attracted the highest quantum of start-up investment at an annual average of $4 billion over the last three years.

The city clearly has an edge with the largest stock of Grade A office space in Asia after Tokyo, low employer costs (reflecting moderate staff costs and office rents), and is among the top 10 inexpensive cities with respect to cost of living,” said Joe Verghese, Managing Director, Colliers International India.

Bengaluru scores 68 per cent in ranking and comes first overall. Bengaluru is the largest office market in the country, with total Grade A stock of 141 million sq ft (13.1 million sq m) spread across multiple micro-markets. On this basis, Bengaluru ranks as the second largest urban office market in Asia after Tokyo.

In recent years the information technology sector has accounted for 60-70 per cent of gross space absorption in India (although this proportion has been slipping due to increased demand from other sectors).

Abundant talent pool

As regards its talent pool, Bengaluru remains the clear preference of most technology groups, with the sector accounting for 45 per cent of total office leasing volume in Q2 2018 and technology followed by flexible workspace representing 26 per cent of leasing volume, engineering and manufacturing at 16 per cent, and banking at 11 per cent, respectively.

On property factors, some of the advantages that Bengaluru has include low employer costs reflecting moderate staff costs and office rents. Under the heading of human factors, Bengaluru benefits from a low cost of living, although it scores less well on measures of quality of office accommodation and quality of infrastructure.