General view of Bengaluru.
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Bengaluru topped the list of 20 Asia Pacific (APAC) cities with the highest flexible office stock at 15.5 million square feet (msf) till June 2024, including Shanghai, Seoul and Tokyo, announced real estate consulting firm CBRE in a report tabled Thursday.
Recent growth in the APAC flexible office space market has been primarily driven by Indian cities where expansion is supported by the demand for managed solutions offered by domestic flexible space operators.
The APAC flex space market continues to display stable growth, with the total stock of flexible office space in the APAC region reaching 89 msf as of June 2024, an increase of 3.9% from 2023.
Delhi-NCR ranks second in the city list with a total stock of 10.7 msf of flexible office space till June 2024. Delhi-NCR also witnessed the highest increase of 26% in the flexible office stock since 2023. Hyderabad and Mumbai also made it to the top 10 cities, with 6.8 and 6.1 msf of flexible office stock, respectively.
Anshuman Magazine, Chairman and CEO, India, South-East Asia, Middle East and Africa, CBRE, said, “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”.
The report also points out that despite a return to growth mode after the pandemic subsided, the Asia Pacific flexible office space market has only now entered a period of normalised expansion compared to the pre-COVID boom years.
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 APAC. In the post-COVID era, operators’ priorities have shifted towards income diversification, turn-key managed solutions, and maximising centre utilisation.”
The APAC region is home to approximately 3,000 flex space centres. With strong leasing activity by flex space operators, it is anticipated that the pace of new flex centre openings will continue to be rapid throughout the remainder of the year in these markets.
The 20 major APAC markets looked at in the study included Japan, China, South Korea, Philippines, Hong Kong, Australia, Vietnam, Singapore, Australia, Taiwan, New Zealand and India.