New Delhi, Dec 31 (PTI) Coworking operators picked up 12.5 million square feet of grade-A office space on rent during 2024, up 44 per cent from the preceding year, to expand their businesses amid rising demand for flexible managed workspaces, according to Colliers India.

They had taken on lease 8.7 million square feet of office space in the 2023 calendar year for further sub-leasing to corporate clients.

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Coworking operators' share in the total gross office space leasing stood at nearly 20 per cent.

Colliers India expects the trend to continue in 2025. The demand is set to increase, encouraging coworking operators to expand their portfolios.

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Commenting on the data, BHIVE workspaces Founder & CEO Shesh Rao Paplikar said, "The demand for coworking and managed office spaces is set to surge in 2025 as businesses continue prioritizing agility, cost-efficiency, and employee-centric workplace solutions."

Nikhil Madan, Co-founder of The Office Pass, attributed the rise in demand for flex spaces to significant cost advantages, agility and changing workforce needs. "Flex space providers are very well capitalizing on this demand as the total flex office stock has already reached close to 70 million square feet by the end of H1 2024 and shall touch triple digit in couple of years".

Amal Mishra, Founder and CEO, Urban Vault, said the demand for managed coworking spaces is poised to grow even more rapidly.

"Cities such as Bengaluru, Gurugram, Hyderabad, and Mumbai are expected to account for the lion's share of this growth. Institutional investors remain optimistic about the potential of the segment and have been actively investing in it, a trend that is likely to continue in 2025," he added.

Manas Mehrotra, Founder of 315Work Avenue, said, the coworking industry has become more relevant than ever with the demand surging significantly in the recent times owing to numerous factors.

"Coworking spaces have emerged as the defining feature of India's rapidly evolving commercial real estate market, reflecting the broader shift toward work culture, flexibility, collaboration, innovation, and sustainability," he added.

Parul Thakur, Senior Vice President and Business Head, Cowrks, said, the rising demand for managed office spaces is reshaping workplace dynamics, and flex space providers are at the forefront of this transformation.

"By offering agile and customizable solutions, providers are enabling businesses to address evolving needs while focusing on collaboration, innovation, and growth. Providers are also investing in modern infrastructure and hybrid-ready designs that support flexibility, helping organizations enhance operational efficiency and adapt seamlessly to market changes," Thakur said.

Property consultant Anarock MD-Commercial Leasing and Advisory Peush Jain noted that flexible workspaces have truly come-of-age in 2024, with a significant increase in demand for flexible lease terms and managed office spaces, as companies seek agility and cost-efficiency.

Large corporates and startups alike have embraced this new game, with flex space operators reporting record occupancy levels across key cities, he added.

"Occupiers are no longer viewing flex spaces as temporary solutions but as strategic assets that align with hybrid work models. The integration of technology into flex spaces has further enhanced their favourability. Advanced booking systems, AI-driven space utilization analytics, and smart building solutions have made these spaces more efficient and feasible for users," Jain said.

According to Vestian data, flexible office space operators have a portfolio of 67 million square feet of prime office space and the number is set to cross 100 million square feet by 2026-end as they look to expand amid a rise in demand from corporates.

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