Over 80 per cent of occupiers plan to expand their office portfolio through flex spaces over the next three to five years. This shift is largely driven by the reimagination of workplaces, changing perceptions, and the enterprise-level offerings that flex spaces now provide, revealed in a report from Colliers, titled Flex Spaces: Reshaping the New-Age India Office Market.
According to the survey, which covered start-ups, multinational companies (MNCs), and Global Capability Centers (GCCs), large corporations are increasingly adopting flex spaces as part of their real estate footprint. The main advantage of flex spaces lies in the flexibility they add to portfolios while helping to manage costs. Enhanced productivity, sustainability, and advanced technology and security features also add to their appeal.
Colliers predicts that the growth in flex space adoption will be highest among MNCs, with a three to four times increase in usage expected by 2030.
Flex Spaces Emerging as Core Business Centres
The report indicates that 60 per cent of occupiers are likely to have at least 20 per cent of their office portfolio composed of flex spaces in the next three to five years. Notably, 40 per cent of technology sector occupiers have embraced flex spaces for core operations. This shift is due to the increasing sophistication of technology and enterprise-level offerings in flex spaces.
"Workspaces have evolved into centres for collaboration, innovation, and wellbeing, with flex spaces offering holistic solutions," said Vimal Nadar, Senior Director & Head of Research at Colliers India. "The average commitment period for flex spaces could reach up to three years in the near future, compared to pre-pandemic leases, which were typically less than a year."
Preferred Locations for Flex Space Expansion
Location remains a critical factor in expansion decisions, with 60 per cent of respondents indicating that they prefer flex spaces in prime central business districts (CBD) or secondary business districts (SBD) in Tier I or Tier II cities. Furthermore, about 45 per cent of companies surveyed are likely to opt for flex space expansion in these key locations over peripheral areas.
Flex spaces are also set to support distributed work models, with many larger companies, including MNCs and GCCs, using them as both hub and spoke offices to support a flexible and dynamic work environment. |
