New Delhi [India], CBRE South Asia Pvt. Limited. Ltd., has released the results of its latest 'India Office Occupant Survey 2024', which reveals that the proportion of companies with more than 10 per cent of their office portfolio in flexible workspaces will increase from 42 per cent in the first quarter of 2024 to 58 percent by 2026.
The results highlight a significant shift towards flexible office spaces and a strong commitment to environmental, social and governance (ESG) objectives among Indian companies.
Over the next 12 months, approximately 30 percent of companies plan to increase the use of flexible office space as a core component of their office strategy. This trend is expected to continue as companies seek to adapt to changes in the work patterns and employee expectations.
Flexible space operators have emerged as a key player in India's office leasing market, consistently maintaining a share of over 15 per cent of quarterly leasing activity.
By the end of 2024, CBRE anticipates that the total stock of flexible space will reach 80 million square feet. In response to the growing demand for flexible workspaces, companies are also likely to expand into a greater number of offices.
This will allow them to better adapt to a growing workforce and access new markets. Many companies are exploring decentralizing their offices, employing a combination of traditional and flexible spaces tailored to specific business needs.
However, the trend toward flexibility is balanced by a drive toward efficiency. About 17 percent of companies aim to consolidate their office spaces into fewer locations to streamline operations and reduce costs. This consolidation strategy aligns with the broader trend of "flight to quality" relocations, where companies They are moving to higher quality office spaces to better meet their changing needs.
Occupiers remain committed to long-term expansion in the Indian office market, with nearly 70 per cent indicating plans to grow their office portfolios over the next two years.
This includes 73 percent of domestic corporations and 78 percent of global companies, which plan to expand their portfolios by 10 percent or more. The survey highlights sector-specific trends, with 88 percent of companies BFSI (Banking, Financial Services and Insurance), 67 percent of Global Capability Centers (GCCs) and 53 percent of technology companies planning significant portfolio expansions.
While hybrid work models remain common, there is a clear shift towards an “office first” approach.
The survey reveals that 90 percent of respondents prefer to be in the office at least three days a week, and a growing number of employees prefer a full-time office presence. This change reflects a tightening of work policies hybrid as companies emphasize the benefits of in-person collaboration and a structured work environment.
Modern and sustainable office developments are set to capture a greater market share in the coming years.
Occupiers are increasingly seeking buildings with features that support ESG goals, such as electric vehicle charging infrastructure, health, safety and wellness certifications, and green building certifications. About 67 percent of companies plan to allocate more than 5 percent of their project budgets to ESG initiatives.
This focus on sustainability is driving owners to improve energy efficiency, provide fitness and wellness facilities, and improve the overall employee experience.
The survey also indicates growing interest in expanding to smaller cities. Tier II and III cities are becoming attractive options for both global and Indian companies due to their skilled talent pools, competitive costs and infrastructure improvements. BFSI and technology companies are particularly active in these areas, and National companies show a preference for expansion in these cities over the next one to three years.
As a result, these cities are seeing a shift towards modern office parks and a rise in flexible workspace operators catering to the needs of enterprises and startups.
Anshuman Magazine, President and CEO – India, Southeast Asia, Middle East and Africa, CBRE, said: “The sharp rise in occupier activity within India’s office sector, highlighted by 2023 absorption figures, which are the second highest ever recorded, underlines a notable trend." He added: "This increase reflects increased occupier confidence, driven by a growing presence of commercial offices and growing demand for high-quality space. has been boosted by pent-up demand from companies that postponed leasing decisions during the pandemic, further fueling the current momentum."
Ram Chandnani, Managing Director, Advisory and Transaction Services, CBRE India, said: "The survey provides valuable insights into evolving occupier preferences amid business growth and future aspirations. The survey highlights a clear policy preference of 'office first', reflecting an acceleration back to office attendance."
He added: "Furthermore, occupiers continue to demonstrate confidence in India's office sector, with intentions to expand their portfolios. There is also a strong focus on workplace transformation, emphasizing the importance of employee experience in achieving business goals and cultivate a positive work environment."
The results highlight a significant shift towards flexible office spaces and a strong commitment to environmental, social and governance (ESG) objectives among Indian companies.
Over the next 12 months, approximately 30 percent of companies plan to increase the use of flexible office space as a core component of their office strategy. This trend is expected to continue as companies seek to adapt to changes in the work patterns and employee expectations.
Flexible space operators have emerged as a key player in India's office leasing market, consistently maintaining a share of over 15 per cent of quarterly leasing activity.
By the end of 2024, CBRE anticipates that the total stock of flexible space will reach 80 million square feet. In response to the growing demand for flexible workspaces, companies are also likely to expand into a greater number of offices.
This will allow them to better adapt to a growing workforce and access new markets. Many companies are exploring decentralizing their offices, employing a combination of traditional and flexible spaces tailored to specific business needs.
However, the trend toward flexibility is balanced by a drive toward efficiency. About 17 percent of companies aim to consolidate their office spaces into fewer locations to streamline operations and reduce costs. This consolidation strategy aligns with the broader trend of "flight to quality" relocations, where companies They are moving to higher quality office spaces to better meet their changing needs.
Occupiers remain committed to long-term expansion in the Indian office market, with nearly 70 per cent indicating plans to grow their office portfolios over the next two years.
This includes 73 percent of domestic corporations and 78 percent of global companies, which plan to expand their portfolios by 10 percent or more. The survey highlights sector-specific trends, with 88 percent of companies BFSI (Banking, Financial Services and Insurance), 67 percent of Global Capability Centers (GCCs) and 53 percent of technology companies planning significant portfolio expansions.
While hybrid work models remain common, there is a clear shift towards an “office first” approach.
The survey reveals that 90 percent of respondents prefer to be in the office at least three days a week, and a growing number of employees prefer a full-time office presence. This change reflects a tightening of work policies hybrid as companies emphasize the benefits of in-person collaboration and a structured work environment.
Modern and sustainable office developments are set to capture a greater market share in the coming years.
Occupiers are increasingly seeking buildings with features that support ESG goals, such as electric vehicle charging infrastructure, health, safety and wellness certifications, and green building certifications. About 67 percent of companies plan to allocate more than 5 percent of their project budgets to ESG initiatives.
This focus on sustainability is driving owners to improve energy efficiency, provide fitness and wellness facilities, and improve the overall employee experience.
The survey also indicates growing interest in expanding to smaller cities. Tier II and III cities are becoming attractive options for both global and Indian companies due to their skilled talent pools, competitive costs and infrastructure improvements. BFSI and technology companies are particularly active in these areas, and National companies show a preference for expansion in these cities over the next one to three years.
As a result, these cities are seeing a shift towards modern office parks and a rise in flexible workspace operators catering to the needs of enterprises and startups.
Anshuman Magazine, President and CEO – India, Southeast Asia, Middle East and Africa, CBRE, said: “The sharp rise in occupier activity within India’s office sector, highlighted by 2023 absorption figures, which are the second highest ever recorded, underlines a notable trend." He added: "This increase reflects increased occupier confidence, driven by a growing presence of commercial offices and growing demand for high-quality space. has been boosted by pent-up demand from companies that postponed leasing decisions during the pandemic, further fueling the current momentum."
Ram Chandnani, Managing Director, Advisory and Transaction Services, CBRE India, said: "The survey provides valuable insights into evolving occupier preferences amid business growth and future aspirations. The survey highlights a clear policy preference of 'office first', reflecting an acceleration back to office attendance."
He added: "Furthermore, occupiers continue to demonstrate confidence in India's office sector, with intentions to expand their portfolios. There is also a strong focus on workplace transformation, emphasizing the importance of employee experience in achieving business goals and cultivate a positive work environment."
