The Spaniard, playing in Australia for the first time since 2010, is the only non-local in the top 14 and sits joint-third alongside Marc Leishman, Daniel Nisbet, Michael Wright and veteran Peter Senior.
"I wouldn't say that it was amazing but it was good," Garcia said after his round at the tournament co-sanctioned by the PGA Tour of Australasia and European Tour.
"The most positive thing for me would be to go a bogey-free round, which I didn't realise until we got done.
"Hopefully I'm able to do more of the same but every day's a different story and it also depends on the weather. If it gets windy it can be quite tricky, this course."
Former Australian Masters winner Senior announced his retirement in 2016 but returned to action on Thursday with a spotless round that included five birdies to match Garcia's score.
Seven players, including Rhein Gibson, Greg Chalmers and Cameron Smith, were a further shot behind in joint-eighth.
Defending champion Harold Varner III, recent Hong Kong Open winner Wade Ormsby and 2013 U.S. Masters champion Adam Scott are well off the pace on one-under.
(Reporting by Aditi Prakash in Bengaluru)
