India’s flexible workspace industry has emerged as one of the fastest-growing segments of the commercial real estate market. As companies rethink traditional office models and shift towards agile, asset-light operations, flexible offices are increasingly becoming the preferred choice. With Union Budget 2026 approaching, industry leaders are now looking to the government for policy support to help sustain this momentum.
According to industry estimates, the Indian flexible office market was valued at USD 5.99 billion in 2025 and is expected to nearly double to USD 11.39 billion by 2030, growing at a strong CAGR of 13.72%. By 2026–27, the total stock of flexible office space across the country is projected to cross 100 million square feet, reflecting growing demand from startups, large enterprises, and global corporations.
This growth, experts say, has been driven by changing work patterns, the rise of hybrid work, and the increasing entry of Global Capability Centers (GCCs) into India. However, to ensure long-term and sustainable growth, the industry believes that supportive measures in the Union Budget 2026 are essential.
“India’s flexible workspace sector is becoming a critical enabler for global businesses, especially Global Capability Centers and digitally driven enterprises,” said Archana Naidu, Board Member and Head of Business at iKeva. “For Budget 2026, the industry expects clear policy support through tax reforms, streamlined regulations, and incentives for expansion into emerging cities.”
One of the industry’s key demands is GST rationalisation. Currently, flexible workspace services are often taxed under categories similar to hospitality, which increases compliance complexity and operational costs. Industry leaders believe flex spaces should instead be treated as essential business infrastructure, similar to traditional offices.
“GST rationalisation on flex space services will be vital to reduce the compliance burden and make flexible offices more accessible to businesses of all sizes,” Naidu added.
Along with tax reforms, regulatory clarity is another major area of concern. As flexible workspaces become more tech-enabled, reliable digital connectivity has become critical. The
industry is seeking clear government guidelines on satellite communication (SatCom) spectrum policies to support high-speed connectivity and seamless hybrid and remote work operations. Faster and more streamlined approvals for setting up new flexible workspace centres are also high on the wish list. This is particularly important for Tier 2 and Tier 3 cities, where demand for organised workspaces is rising but regulatory processes can slow down expansion.
Another key growth driver highlighted by the industry is the role of flexible workspaces in supporting Global Capability Centers. Many global companies entering India prefer flex spaces as plug-and-play solutions that allow them to start operations quickly without heavy upfront investments.
“Flexible offices have become an easy entry point for global companies looking to establish or expand their presence in India,” said Naidu. “With the right policy support, India can further strengthen its position as a preferred destination for global businesses.”
Technology adoption is also central to the sector’s future. Industry leaders are urging the government to introduce tax incentives for digital infrastructure, including AI-powered workplaces, IoT-enabled buildings, and immersive technologies such as AR and VR. These technologies not only improve productivity but also enhance the overall employee experience.
Sustainability has emerged as another important focus area. As global companies increasingly prioritise ESG goals, flexible workspace operators are investing in green buildings and energy-efficient designs. The industry is calling for policy incentives and certifications that encourage sustainable practices and align Indian workspaces with global ESG standards.
The expansion of flexible offices beyond metro cities is seen as a major opportunity. With the right incentives, Tier 2 and Tier 3 cities can attract new businesses, create jobs, and support balanced economic growth.
Industry leaders believe that if these policy measures are addressed in Union Budget 2026, India’s flexible workspace sector will be well-positioned to drive innovation, attract global investments, and support the evolving needs of modern businesses.
