Corporates to utilise more flexible office spaces in next 3-4 years: Report

"The flex penetration in the Indian office market is set to cross double digits in the next 34 years, up from 6-7% currently," Colliers India CEO Badal Yagnik said in the report

The share of flexible office spaces in the total premium office supply across six major cities has risen to 6-7 per cent and is set to reach double-digit in the next 34 years amid a rise in demand for flex workspaces from large corporates, according to Colliers.

Real estate consultant Colliers India on Friday released a report 'Shared Office Spaces in India Flexing Ahead' at industry body FICCI's conference in Bengaluru.

"The flex penetration in the Indian office market is set to cross double digits in the next 34 years, up from 6-7 per cent currently," Colliers India CEO Badal Yagnik said in the report.

Flexible space operators have 43.5 million square feet under their operations across six major cities -- Bengaluru, Chennai, Delhi-NCR, Mumbai, Hyderabad and Pune.

The total seats are estimated at 6,24,000. Bengaluru has 14.7 million square feet of office space under this flexible space model.

"With the growing adoption of flex spaces within mainstream commercial office real estate, India will continue to remain the flex epicentre in the (Asia-pacific) APAC region," Yagnik said.

"Sustainability in terms of the design of flex spaces will encompass wellness aspects of employees in the flex centres across the country, while demand scalability, rental arbitrage, and improved real estate operating margins will continue to result in flex spaces becoming an even more significant contributor to office market activity in India," he said.

In 2022, flexible space operators took on lease 7 million square feet area in these six cities, accounting for 14 per cent of the total gross office leasing.

Till September this year, the flex space operators have taken 6.5 million square feet office space on lease from landlords, contributing 17 per cent to the total gross leasing across these six cities.

Amal Mishra, Co-founder, UrbanVault, a Bengaluru-based managed co-working space provider, said there is a notable surge in the acceptance of flexible workspaces in India, particularly in cities like Bengaluru, Hyderabad, Mumbai, and Gurugram.

"Over the past few years, both domestic and global firms have recognised the appeal of flexibility with minimal capital investment.

"Within the realm of flexible workspaces, there is a growing demand for managed spaces. Companies are not only seeking state-of-the-art interiors but are also prioritizing enhanced services and amenities, aiming to provide their employees with a hassle-free and well-equipped work environment," he added.