Flex space stock in Pune is expected to cross 8 million square feet by 2025: Colliers
- IBEF
- August 1, 2023
According to Colliers' most recent report, "Pune-Tech-tonic shift to flex," Pune's flex space stock is predicted to reach 8 million square feet by 2025, driven by demand from technology and other major sectors, and making up 10% of the city's total office stock.
In the previous five years, Pune's flex space market has experienced tremendous expansion, driven by the city's expanding young population, the presence of important tech corporations, and the proliferation of several startups. The demand for flexible spaces in the city has increased as a result of occupants' hybrid workstyles, particularly in the wake of the pandemic.
The report claims that from 2018, Pune's flexible space has increased fourfold, reaching 5.4 million square feet as of June 2023. This equals 8.3% of the city's total Grade A office space, the largest percentage among the top 6 cities. Pune has surpassed Bengaluru in terms of flex space penetration, with 8.3%, however, Bengaluru continues to be the top flex space market in India in terms of the size of flex stock.
Pune has risen to become one of the top locations for flexible space in India, experiencing rapid expansion over the previous five years. From 5% in 2018 to 25% in 2022, Pune's share of pan-India flex leasing rose.
Flex space operators leased 1.77 million square feet of office space in 2022, making about 35% of the city's overall leasing. They also experienced active leasing in the first half of 2023, accounting for 0.57 million square feet, or about 22% of the total leasing. As a result, according to Colliers, the stock of flex space increased significantly by 4X, from 1.3 million square feet in 2018 to 5.4 million square feet as of June 2023.
Throughout 2020 till the first half (H1) of 2023, the technology sector continued to be the largest occupier of flexible space, accounting for 43% of the total seat uptake. Engineering and manufacturing came in second with a 27% share. The report stated that because technology companies are projected to continue to prioritise hybrid working, they would continue to drive the demand for flexible space in the city.
Flex spaces have been significant in enabling new workspace models for occupants, including flex plus core, distributed workplace strategy, and hybrid working, and have grown to play a crucial role in occupants' portfolios. According to Colliers, the percentage of flex space in occupier portfolios throughout all of India increased from 5-8% in 2019 to 10-12% in 2023.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
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