India's flex space market to surpass 100 million Sq Ft by 2027 as enterprises, GCC Demand surge: Report

Flex penetration within Grade A office stock is projected to rise from 8.5 per cent to 10.5 per cent during the same period, driven by sustained operator expansion and a surge in enterprise demand, according to Colliers, a global diversified professional services company, specializing in commercial real estate services, engineering consultancy and investment management.

Average annual enterprise seat uptake is forecast to reach 200,000 seats in 2026 and 2027, marking a 25 per cent increase compared to levels seen in 2024 and 2025.

Arpit Mehrotra, Managing Director, Office Services at Colliers India, described the current phase as a "pivotal era of expansion," noting that flex operators are increasingly offering next-generation workspaces enabled by PropTech, customization options, and sustainable features.

Mehrotra added that operator IPOs reflect rising investor confidence in the segment.

"India's flex market is entering a pivotal era of expansion, with Grade A stock set to surpass 100 million square feet by 2027, growing annually by nearly 20% across the top 7 cities. As domestic enterprises and global firms, especially Global Capability Centers (GCCs) deepen their flex adoption, operators are responding by curating next-generation, customized workspaces adept with advanced PropTech and sustainable features. The flex market momentum is further being bolstered by growing number of operators raising capital through IPOs, signaling strong investor confidence. Overall, the next phase of India's flex market will be driven by the growth of technology firms, the expansion of GCCs, changing expectations of occupiers and increasing appetite of institutional investors," said Arpit Mehrotra, Managing Director, Office Services, Colliers India.

Bengaluru continues to lead the country's flex stock with more than 22 million sq ft, representing 31 per cent of India's total supply.

Delhi NCR follows with 12.5 million sq ft, while Pune stands out for having the highest flex penetration at 11.5 per cent, supported by robust demand from technology and BFSI occupiers.

Chennai is emerging as one of the fastest-growing flex markets, having expanded its flex footprint more than fivefold since 2021.

The Colliers report notes a strong shift toward fully managed, tech-integrated, and ESG-focused workspace solutions. As Global Capability Centres (GCCs) deepen their India presence, operators are increasingly offering "GCC-as-a-Service" models that provide end-to-end support from location planning to workplace deployment.

GCCs accounted for 40-45 per cent of enterprise flex demand in 2025, a share expected to rise to nearly half of all enterprise seat uptake over the next two years.

Secondary Business Districts (SBDs) across Tier I cities remain the core hubs for flex expansion, contributing over half of Grade A flex absorption in the last five years. Meanwhile, Tier II cities such as Ahmedabad, Kochi, Jaipur, and Coimbatore are witnessing rising interest as occupiers leverage lower rentals, typically 30-35 per cent below Tier I levels, to adopt distributed workforce models.

Colliers projects Tier II markets could account for 10-15 per cent of India's flex stock by 2027. (ANI)