Cushman & Wakefield Projects India's Flexible Office Space to Surpass 100 Million Sq Ft Milestone by 2026

Leading global real estate consultancy Cushman & Wakefield has projected that India's flexible office and co-working space market will achieve a significant milestone, with the stock expected to cross 100 million square feet by 2026. The firm reported that the top eight cities currently house over 79.7 million square feet of flexible office space as of Q2 2025.

Current Market Standing and Growth Projections

According to the Global Trends in Flexible Office 2025 report released by Cushman & Wakefield, the flexible office space inventory is anticipated to reach approximately 85 million square feet by the end of 2025 before crossing the 100 million square feet mark by 2026. This growth trajectory represents a substantial expansion in India's alternative workspace segment.

India Achieves Perfect Score in Global Maturity Rankings

The report highlighted that India has secured a perfect score of 100 on Cushman & Wakefield's maturity index for flexible office markets, positioning it ahead of established markets including the UK (98), France (97), the US (81), and both Japan and Singapore (77 each). This ranking reflects the sophistication and development of India's flexible workspace ecosystem.

Industry analysts noted that demand for flexible workspaces has experienced approximately six-fold growth since 2020, demonstrating the rapid adoption of alternative office solutions across the country. In 2024, flexible offices represented around 15% of all new office leasing activity across major markets.

Corporate Demand Drives Market Expansion

The research revealed that large corporations, particularly Global Capability Centres (GCCs), have been the primary drivers of growth, accounting for 72% of demand in the flexible office segment. Startups contributed the remaining 28% to the overall demand, indicating a diverse user base for these alternative workspace solutions.

This trend aligns with broader developments in India's office real estate expansion, where technology companies and service providers continue to drive market growth.

Cost Advantages and Business Agility

Several factors have contributed to the surge in flexible office adoption across Indian markets. Cost advantage remains a significant driver, with fit-out costs in Indian metros including Mumbai, Delhi, and Bengaluru averaging around US$75 per square foot, substantially lower than many Western cities.

Business agility has emerged as another crucial factor, with companies increasingly preferring managed and enterprise solutions models to enable rapid scaling. The appeal of flexible leasing terms, shorter commitments, and quicker move-in options has resonated particularly well with businesses seeking operational flexibility.

Investment Interest and Market Consolidation

The sector has witnessed growing investor interest, with several flexible workspace operators pursuing public listings and more Initial Public Offerings (IPOs) expected in the pipeline. Market observers anticipate that larger players may consolidate market share over the coming years, potentially leading to industry maturation.

This consolidation trend is similar to patterns observed in other segments of India's commercial real estate market, where REIT-worthy office space has shown significant value appreciation across major cities.

Emerging Trends and Future Outlook

Industry experts suggest monitoring expansion into Tier-2 cities including Jaipur, Kochi, and Visakhapatnam, as these markets are showing early signs of flexible office space adoption. The quality and sustainability of operations regarding leases, amenities, and cost management will be critical factors as the market scales.

The balance between operator economics, including rental yields and occupancy rates, and tenant expectations for service quality and flexibility will likely determine the long-term success of this market segment. Additionally, regulatory frameworks, infrastructure development, and connectivity improvements will play vital roles in supporting this growth trajectory.

The expansion mirrors broader infrastructure developments across India, such as infrastructure projects boosting Mumbai's eastern corridor, which create conducive environments for commercial real estate growth.

Market Implications and Strategic Considerations

Industry analysts emphasized that India's flexible office market is transitioning from a niche concept to a fundamental component of the country's commercial real estate landscape. The achievement of the 100 million square feet milestone will represent not only scale but also the maturity and robustness of this market segment.

For companies seeking operational agility, operators looking to scale their operations, and investors exploring alternative real estate investment opportunities, this growth trend presents significant opportunities. The development aligns with broader pre-leasing trends in flex space markets across the country.

The flexible office space evolution also reflects changing work patterns and corporate real estate strategies, particularly in the post-pandemic business environment where flexibility and adaptability have become paramount considerations for organizations across various sectors.