Work-from-office mandates see flexi space providers catching up with tech firms in leasing offices

livemint.com:

MUMBAI : Flexible office space providers have emerged as a significant challenger to technology firms in leasing offices, as companies across sectors gradually enforce return-to-office mandates for their employees. Between January and March, flexible office space providers have already captured a significant 22% share of leasing activity, as per a report by real estate consultancy CBRE. This translates to a leased area of about 3 million sq.ft., marking a significant rise in the sector's influence.

Flexible space operators consistently exceeding a 15% share in leasing activity over the past five years, a trend CBRE anticipates will continue. The technology sector remains the largest in terms of total space leased, accounting for a 26% share during the January-Marchquarter. The tech and flexible spaces sector together account for nearly half of all the office space leased in the March quarter, compared with 32% in the preceding three months.

This growth is attributed to a surge in demand from domestic firms, particularly those in the technology and financial services sectors. Notably, software and services companies within the technology sector took up 95% of the space leased by tech firms in the January-March period. “The office sector continued witnessing meaningful gains in 2023, enhanced by a resurgence in occupiers’ sentiments and pent-up demand post a rise in return-to-offices," said Anshuman Magazine, chairman and CEO-India, South-East Asia, Middle East & Africa, CBRE.