The tech capital of India, Bangalore has topped the list of 20 APAC cities with the largest flexible office stock at 15.5 million square feet, surpassing cities such as Shanghai, Seoul, and Tokyo.
Following Bangalore, Delhi NCR ranks second with a total flexible office space stock of 10.7 million square feet as of June 2024, mentioned CBRE.
Recent growth in the Asia Pacific flexible office space market has been primarily driven by Indian cities, where the expansion is supported by the demand for managed solutions offered by domestic flexible office operators.
Anshuman Magazine, Chairman & CEO – India, South-East Asia, Middle East & Africa, CBRE, said, “Recent growth in the Asia Pacific flexible office space market has been primarily driven by Indian cities, where expansion has been underpinned by demand for managed solutions offered by domestic flexible space operators.
The ongoing expansion of the flexible office space market in India highlights its significance as a strategic option for businesses adapting to the changing demands of workspace needs”.
According to the report, Delhi NCR witnessed the highest increase of 26 % in the flexible office stock since CY2023. Other Indian cities also did exceedingly well with Hyderabad and Mumbai making it to the top 10 cities, with 6.8 and 6.1 mn. sq. ft. of flexible office stock, respectively.The Asia Pacific flex space market continues to display stable growth, with the total stock of flexible office space in the APAC region reaching 89 million sq. ft. as of June 2024, an increase of 3.9% from CY 2023. The report points out that the APAC region is home to approximately 3,000 flex space centers. With strong leasing activity by flex space operators during this period, it is anticipated that the pace of new flex center openings will continue to be rapid throughout the remainder of the year in these markets.
Henry Chin, Global Head of Investor Thought Leadership and Head of Research, CBRE APAC, said, “Recent years have seen an evolution in business strategy by operators of flexible office space in Asia Pacific. In the post-COVID era, operators’ priorities have shifted towards income diversification, turn-key managed solutions, and maximizing centre utilization.
Operators are increasingly differentiating their brands and exploring alternative deal structures, such as management agreements and CapEx contributions by landlords, to create more sustainable business models. Leveraging turn-key managed solutions enables operators to increase commitment terms while providing additional value to occupier solutions”.
The report also points out that despite a return to growth mode after the pandemic subsided, the Asia Pacific flexible office space market has now entered a period of normalized expansion compared to the pre-COVID boom years.
CBRE APAC study covered 20 major Asia-Pacific markets, including Japan, China, South Korea, Philippines, Hong Kong, Australia, Vietnam, Singapore, Australia, Taiwan, New Zealand and India.
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