New Delhi, September 20, 2023: Flexible office space stock is estimated to rise 52 per cent by 2025 to 81 million square feet with operators expanding their business to tap rising demand, according to Vestian. Flexible office space operators currently have 53.4 million square feet area under operations and the number is estimated to reach 81 million square feet by 2025.
On Wednesday, Vestian released its report ‘Flexing the Workspace-Back to Office’, highlighting that over 7.6 lakh seats are available with flexible space operators spread across more than 1000 centers in India.
Vestian CEO Shrinivas Rao said the flexible spaces sector is at a nascent stage in India compared to other countries such as the USA and European countries. “It has grown gradually in India and flexible office stock has reached 53.4 million sq ft. Furthermore, the stock is anticipated to reach 81 million sq ft by 2025, growing at a CAGR of 23 per cent, as COVID-19 catalyzed the market growth,” he said.
The report noted that wider adoption of flexible spaces in India started in 2015-16 when the market was fragmented and unorganized. However, it has since grown rapidly and become more organized. Flexible spaces are garnering significant attention not only from startups and SMEs but also from large enterprises, the report said.
“Flexible space operators provide what occupiers are looking for – low cost, flexibility and technologically advanced spaces. While 2023 is likely to be a challenging year for businesses amid macroeconomic uncertainty and fear of recession, flexible spaces are a way to navigate global headwinds,” Rao observed.
As several companies return their employees back to office under a hybrid model, it is expected the demand for flexible spaces to rise. Furthermore, Vestian has projected that the flexible office sector would constitute around 25% of the overall office space absorption by 2025.
|
Years |
Flexible spaces absorption (Mn sq ft) |
% Share in overall absorption |
|
2016 |
1.1 |
2% |
|
2017 |
2.2 |
5% |
|
2018 |
4.8 |
10% |
|
2019 |
6.8 |
14% |
|
2020 |
3.5 |
9% |
|
2021 |
4.9 |
12% |
|
2022 |
8.4 |
16% |
|
2023 (F) |
10.5 |
20% |
|
2025 (F) |
12.8 |
25% |
Flexible office spaces broadly include dedicated desks, hotdesking, coworking spaces, serviced and managed office spaces. While coworking centers are at the most flexible end of the spectrum, managed offices would be at the less flexible end, it added.
The report mentioned that there are 50 major flexible space operators. The top 10 players hold 84 per cent of the total flexible office space portfolio.
Prominent office areas like Whitefield in Bengaluru, Hitec City in Hyderabad, Baner in Pune, Andheri (E) in Mumbai, and DLF Cybercity in Gurugram are popular with flex space operators and occupiers/tenants alike.
Corporate Comm India (CCI Newswire)
