Flexible workspaces evolving to largely target corporate clients
The total flexible workspace stock in top six Indian cities is almost 30 million sq feet (2.8 million sq meters); 4.3% of total commercial office stock. We expect to see demand for well-located, high quality and efficient flexible workspaces to increase, resulting in their occupying 5.4% of the total office portfolio by 2022. We recommend that
- Corporate occupiers build a part of their office portfolio in flexible workspaces to avoid long-term capital expenditures, and to get more flexibility on their lease terms whilst they are still firming up their long-term plans.
- Flexible workspace operators engage as managers for large spaces leased on a management fee and revenue share model with landlords to help focus on profitability.