The world’s largest luxury carmaker Mercedes-Benz has picked up 3.5 lakh sq ft of commercial space in Bengaluru’s eastern peripheral area of Brookefield on a 15-year long-term lease.The company is expected to lease 1 million sq ft here, including the second tranche of 4 lakh sq ft next year, said people with direct knowledge of the development.The transaction assumes significance as the automotive industry gets disrupted with autonomous, electric and shared mobility; Mercedes-Benz is expanding its research & development footprint here. The carmaker will be relying heavily on IT talent in and around India ’s Silicon Valley . “The company is expected to use this space for SAP delivery platform with allied research. After the first two tranches, the balance 250,000 sq ft out of total planned 1 million sq ft will be leased later,” said one of the people mentioned above.The initial 3.5 lakh sq ft office space leased by the company will have capacity to accommodate around 3,500 employees.Mercedes-Benz will be paying rental of ?38 per sq ft month, pushing the annual payout to nearly Rs 16 crore. Once the total 1 million sq ft is leased, the annual rental pay-out would stand at nearly ?46 crore. The company has leased the space in Brigade Enterprises’ commercial project Brigade Tech Gardens. Brigade Enterprises declined to comment for the story, while ET’s email query to Mercedes-Benz Research & Development India did not elicit any response till press time on Friday.The lease will have total tenure of 15 years, including three standard terms of five years each. The lease agreement has a 15% rental escalation clause set for every 3 years. The firm will also be paying security deposit equivalent to eight months’ rentals.The Indian R&D set-up for Mercedes-Benz has metamorphosed from a tiny division with 20 staffers in Bengaluru a couple of decades ago into a powerhouse of over 5,000 engineers that is contributing significantly to new-age technology.The company had already announced doubling its office space in India in 2018 as the scope of work expands significantly.The new place may house the Mercedes-Benz User Experience Team that is working on cutting edge artificial intelligence-based infotainment system for global markets, bulk of which is developed in Bengaluru.