A report by Ambit Capital highlights India's flexible office market's potential for a 25% CAGR growth by 2027, reaching Rs 330 billion. Post-COVID hybrid work trends have fueled this expansion, with enterprises drawn to cost savings and versatility of flex spaces.
The flexible office sector in India is on the brink of significant growth, with projections suggesting a more than 25% compound annual growth rate (CAGR) by 2027, creating a Rs 330 billion opportunity, according to Ambit Capital.
The shift towards hybrid work post-COVID has been pivotal, steering large businesses towards flexible workspaces that can offer up to 20% cost savings over traditional leasing options. The report emphasizes, "Flex segment is set to grow at >25% CAGR by CY27E, implying an approx. Rs330bn opportunity."
Operators are now providing a spectrum of workspace solutions from managed offices to collaborative environments with wellness and hospitality amenities. Particularly, managed workspaces have expanded rapidly, boasting a 47% CAGR since CY18, surpassing the 16% growth of co-working spaces in the same period.
As the flexible workspace sector is projected to grow over 25% CAGR by CY27E, it will continue to outperform the broader office market, which is estimated to rise by just 6-7%. Many operators are diversifying into new areas like furniture manufacturing, which is expected to be a Rs 190 billion market by CY29E.
Once limited to freelancers and startups, flex workspaces have increasingly become central to the real estate strategies of major corporations and property owners. These fully furnished, service-oriented office solutions offer adaptable terms in space, leasing, and location, showcasing their resilience post-pandemic. Larger companies are attracted to the benefits, including quicker setups, customizable leases, and reduced initial costs, driving the segment's robust growth.
This enterprise adoption is pivotal for sustaining the high growth of flexible office space. (ANI)