The landscape of commercial office spaces is undergoing major changes globally due to post-pandemic economic factors and evolving work-life preferences. The changes in India are going to include a dramatic 52% increase in the flexible office space market, according to a new report.
The “Flexing the Workspace-Back to Office” report by real estate consultant Vestian, as featured in YourStory, reveals that flexible office space operators currently manage a portfolio of 53.4 million square feet, and this figure is projected to experience a 52% increase — estimated to reach 81 million square feet by 2025.
This burgeoning growth is not just a random spike. Wider adoption of flexible workspaces in India began around 2015-16, according to YourStory. The industry has since matured and has become more structured and widespread throughout India.
The appeal of these spaces isn’t limited to startups and small and medium enterprises (SMEs). Large enterprises are also recognizing the benefit, and flexible space operators are taking notice. According to the report, out of the 50 major flexible space operators, the top 10 now hold a whopping 84% of the total flexible office space portfolio.
Vestian CEO Shrinivas Rao stated that flexible workspaces are in a “nascent stage” in India when compared to Western counterparts. However, the pandemic has acted as a catalyst, propelling the market’s growth.
The rise in hybrid work models, where employees split their time between home and office, further fueled the demand for flexible spaces. Vestian’s projections indicate that by 2025, the flexible office sector might account for approximately 25% of the total office space absorption. In 2022 alone, co-working/flex space operators leased 8.4 million square feet, with expectations to lease 10.5 million this year and 12.8 million the next, according to YourStory.
It’s worth noting that flexible office spaces encompass a range of options — from co-working spaces and hot desking to serviced and managed office spaces. The major players in this domain include WeWork India, Smartworks, and Awfis, among others. Prominent office areas in cities like Bengaluru, Hyderabad, Mumbai, and Gurugram are reported as becoming hotspots for these operators.