Flexible Workspace Leases At Record, Drive India's Office Space Growth

Flexible workspaces have become a major force in India's commercial real estate, capturing a record 20% share of gross office leasing in 2024, according to JLL.

The sector leased 15.3 million sq. ft., making it the second-largest contributor to office space absorption, behind the tech sector. This surge underscores the growing popularity of flexible workspace solutions as businesses adapt to evolving work strategies.

Delhi NCR led the flex leasing activity, accounting for 42% of the total across top seven cities. Pune followed with a 14% share, while Bengaluru, despite being the largest flex ecosystem in the country, came in third, with a 13% share.

Notably, Delhi NCR, Pune, and Mumbai all saw record years for flex leasing activity, demonstrating a sustained trend of businesses incorporating flexible workspace into their real estate strategies.

Total flex stock in the top seven cities has grown 2.5 times since 2019, reaching 74 million sq. ft, according to JLL. Bengaluru holds the largest share of this inventory, comprising a third of the total operational flex space. The sector has also surpassed the one million-seat milestone, now offering over 1.1 million operational flex seats.

The average size of flex space deals has increased by 21.4% year-on-year, reaching 63,000 sq. ft. in 2024. This growth is attributed to the rise of managed space providers that offer customised and serviced office solutions to large enterprises. Corporations are increasingly utilising these larger flex centers to accommodate substantial teams and operations, leveraging modern layouts, technology-enabled offices, and enhanced amenities to improve office occupancy and return-to-office rates.

A significant trend observed in 2024 was the preference for green-certified buildings among flex space operators. Over two-thirds of the space leased by flex operators was located in such developments.

Enterprise leasing of flex solutions also reached a new high in 2024, with 183,200 seats leased to businesses, a 9.2% increase from the previous year. While Bengaluru and Delhi NCR remain dominant markets for enterprise seat take-up, Chennai's emergence as the third-largest market indicates a broader adoption of flexible workspace solutions across India.

JLL anticipates continued growth in the flex space sector, projecting that the operational footprint across India's top seven cities will exceed 100 million sq. ft. by 2026. As India's office market expands, flex space is expected to play a crucial role in accommodating the growing demand for office space.