Realty bites? Zepto shifts HQ from Mumbai to Bengaluru owing to high rents
Zepto has been expanding its footprint in Bengaluru, where the company operates from a 40,000 sq ft space with a staff of close to 700
Mumbai: In Mumbai, you can be a company valuated at $3.6 billion but still feel the pinch of soaring real estate prices. Zepto, the online delivery platform, founded by Aadit Palicha and Kaivalya Vohra from a suburban Mumbai apartment at the end of the pandemic, is moving its headquarters from Mumbai to Bengaluru.
One of the fastest-growing quick commerce companies, Zepto, at present, works out of WeWork at Jogeshwari-Vikhroli Link Road. Sources say the company is scouting for space for its new headquarter at Sarjapur in Bengaluru. “We are looking for about two lakh square feet of office space in Bengaluru. Moving there from Mumbai will save us around ₹40 to 50 lakh in rent on a monthly basis,” said the spokesperson. WeWork itself is moving out of the JVLR premises shortly. Zepto has been headquartered at WeWork, JVLR, for a year where the company occupied 90,000 sq feet.
Zepto, has been expanding its footprint in Bengaluru where the company operates from a 40,000 sq ft space with a staff of close to 700. Co-founder Kaivalya Vohra is already in Bengaluru and CEO Aadit Palicha is expected to follow suit.
“We will continue to have offices in Mumbai but we will be shifting the headquarter to Bengaluru. We are scouting for space in both cities as we are expanding,” said the Zepto spokesperson. Their lease at WeWork in Mumbai expires at the end of the year which is when the headquarter transition will take place. According to a PTI report, the company is in the process of hiring an additional 400 people and report quoted the spokesperson as saying the company had offered its employees the option of moving to Bengaluru and was in the midst of assessing how many of them were willing to move cities.
Zepto’s main competitors Swiggy and Flipkart have their base in Bengaluru, and a Zepto staffer revealed that the company is looking to aggressively expand its reach in southern India, in addition to saving some money on real estate. Sarjapur, where several of India’s tech companies have their offices commands a commercial rental rate of ₹50-65 psqft. Compare this with commercial rents in the JVLR area in Mumbai which hover between ₹150 and 170 psqft.
A recent report by Colliers revealed that office occupiers in the Asia Pacific region are prepared to pay higher rentals for superior-quality offices, despite a cost-conscious mindset. Bengaluru and Hyderabad collectively drove office market activity and it accounted for around half of leasing and three-fourths of the supply in first quarter of 2024. The report said that in Bengaluru, rentals have remained stable, offering companies numerous options across the city.