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Bengaluru: Bengaluru leads flexible workspace inventory amongst India’s top eight cities with 31 per cent of the total stock, with total Grade A flex space supply across these cities reaching 58 million square feet (msf) as of June 2024.
Reporting this on Monday, commercial real estate services firm Cushman & Wakefield and flexible workspace solution providers Table Space, pointed out that this constitutes over 7-8 per cent of India’s total Grade A office supply.
Bengaluru also tops the flex workspace leasing share with 43 per cent of the 4.5 lakh flex workplaces leased in India between 2021 and June 2024, during which time frame the country recorded a 35-37 per cent annual average growth rate. With 2024 having already reached nearly 70 per cent of 2023’s leasing numbers, this year is likely to record a new high, the report said.
January to June (H1) 2024 added 5 msf of new flexible workspace supply, marking the highest-ever contribution of flex leasing to overall office space gross leasing volume (GLV). This continues the momentum of the last 2 years, where capacities grew by 8-9 msf each, growing at 23 per cent in 2022 and 18 per cent in 2023.
The expansion in the flexible workspace segment in India over the past decade has been driven primarily by the growing adoption of hybrid work models and managed office solutions (MOS) post-2020.
In terms of the sectoral demand, the IT sector remains a dominant force, accounting for 40-50 per cent of seat absorption between 2023 and H1 2024. Other sectors such as engineering and manufacturing (14-18 per cent), BFSI (9-12 per cent), and professional services (11-12 per cent) have also contributed to the demand for curated offices in H1 2024.
Ramita Arora, Managing Director, Bengaluru and Head-Flex, India, Cushman & Wakefield said, “The flex-space sector stands out as one of the fastest-growing segments in commercial real estate, with the supply take up currently accounting for about 13 per cent of Grade A office leasing volume. With over half a million flex seats consumed in the last 5 years, a key shift is being witnessed in this segment, as occupiers increasingly seek tailor-made office solutions.”
Flexible spaces now account for 11-13 per cent of the total office space demand nationwide.