In large cities such as Hyderabad, the demand for flexible spaces is likely to rise, with companies having a greater need to address portfolio expansion and contraction along with crisis support.
Hyderabad Records for More Flexible Space in India
As to a recent study by JLL, Hyderabad holds 4.5 million sq.ft. of total flex space stock in India and is one of the country's fastest-growing markets.
Planned workspaces with a lock-in duration of 1-2 years were supported by flex space operators. Companies which have pre-leased their temporary offices with planned delivery over the next 1-2 years have shown interest in flex spaces.
Experts say that Hyderabad also houses several start-ups and small companies in the fields of consulting, IT and logistics, in addition to large MNCs. For such small players and with low CapEx, flex spaces have become financially feasible.
From mid-2018, the flex space market in Hyderabad saw considerable progress and peaked in 2019. Flex spaces accounted for 28 percent of the total rental of office space in the area.
Although flex spaces have already enjoyed popularity among start-ups and small businesses, there has been increased traction among large occupants of BFSI and IT-ITeS, mainly as managed office spaces and incubation spaces. This supports the tremendous rise over the last 2-3 years by the flex space operators in the city.
Strong signs of recovery were seen in the Hyderabad office sector in Q3 2020, with a healthy gross lease at 1.9 million sq.ft. At the same time, from the previous quarter, net absorption increased by 31 percent to 1.5 million sq ft in Q3 2020.
By: Shailaja K