The Rise of Flex Spaces: The Future of Commercial Real Estate in 2025
Managed and flexible office spaces emerged as the big winner of 2025 in commercial real estate. This year saw three major listings: WeWork India, Indiqube, and Smartworks, each contributing significantly to the growth and evolution of the flex space market. These companies have not only scaled up in terms of leasing but have also enhanced the quality of their offerings, making them a preferred choice for enterprises.
Observers and industry players have noted that flex space operators are increasingly collaborating with institutional landlords such as REITs and major developers. This strategic partnership allows them to occupy prime locations and increase per-seat rates. This trend has been particularly beneficial for large players, such as overseas firms setting up strategic facilities like global capability centres (GCCs), which view flex space operators as a viable platform for market entry and expansion.
Harsh Binani, co-founder of Smartworks, highlighted the shift in the real estate landscape: 'Flex is the new operating system for commercial real estate. It answers what enterprises have been signaling for years: agility and capital efficiency matter more than asset ownership. At Smartworks, 2025 validated this shift. From leasing Eastbridge—the largest managed office campus globally—to enabling complex GCC expansions, we saw demand mature rapidly. Whether for hub-and-spoke setups or headquarters consolidation, large occupiers are moving to campus-style flex as their primary strategy.'
A report from real estate consultants Colliers projects that the total stock of flex spaces in India will exceed 100 million square feet in the top seven markets. Flex operators are expected to account for nearly 20 percent of total office leasing in India for 2025. This growth is likely to extend to secondary business districts in Tier-I markets and major Tier-II cities, further solidifying the flex space market's expansion.
Amit Ramani, chairman and managing director of Awfis Space Solutions, India's first major flex space player to be listed on public markets, commented, 'The Colliers report clearly validates the seismic shift underway in India’s office market, a shift where flex has moved from the periphery to the center of occupier strategy. With flex penetration set to cross 10 percent and enterprise demand at an all-time high, the industry is entering a defining phase of maturity and consolidation.'
The asset-light model of flex space players has also been recognized and appreciated by public markets. In a recent report, Ambit Capital noted that flex spaces represent the next growth frontier in commercial real estate. Flex leasing offers up to 20 percent in cost savings for clients compared to traditional leasing. Ambit predicts that the flex segment can grow by more than 25 percent annually by 2027, representing a Rs 33,000 crore opportunity, which outpaces commercial real estate's growth of around 6-7 percent per annum. The report recommends 'buy' calls for the three major listed flex space players: Smartworks, Indiqube, and Awfis.
The models of various flex space players differ slightly in terms of fitout risks and revenue arrangements. For instance, the UK-based International Workplace Group (IWG), which has a significant footprint in India through brands like Regus, avoids leasing and fitout risks. Instead, it works with landlords to bring properties up to international standards and takes a pre-agreed management fee from the property owner, similar to major premium and luxury hotels.
In conclusion, the rise of flex spaces in 2025 marks a significant shift in the commercial real estate landscape, driven by the need for agility and cost efficiency. As the market continues to mature, flex spaces are poised to play an increasingly central role in the future of office leasing in India.
