by THO
Driven by demand from the IT sector and AI-driven research labs, Bengaluru’s office rentals are expected to rise by 5-7% in 2025, said Manish Khedia, Managing Director (South India, West India, and Sri Lanka) at Hong Kong-based flexible workspace provider Executive Centre.
While Bengaluru saw significant demand from the global capability centres last year (GCCs), it is currently witnessing an uptick in demand from the IT sector and AI-driven research labs. “This can also be attributed to a major push from the Indian government to set up these research labs. We also saw major queries from online gaming startups and pharmaceutical companies. These sectors will be a game changer for the flex sector in 2025,” he added.
The mismatch between demand and supply of premium Grade A flex spaces has driven input costs for several flex operators today, especially in Bengaluru. “For example, in prime locations in the central business district areas, flex office space rentals have shot up by 20% since last year. We have also seen the cost of our inputs rising; however, we are looking at optimising the office rentals to bring operational efficiency,” Khedia said.
A flex office space refers to a workspace where businesses can rent office space on short-term leases, allowing them to scale up their office space and downsize depending on the requirement.
According to industry sources, the current flex office space rent in Bengaluru is between ₹6000 per seat and ₹40,000 per seat. Grade A developers offer seats in the range of ₹15,000-50,000 per seat close to the IT corridors and CBD areas.
Eastern and north Bengaluru witness surge in flex space demand
Khedia added that the eastern IT corridor in Whitefield has witnessed a significant uptick in demand for flex spaces in the last six months, especially after the new metro line connecting parts of the IT corridor was operational.
The completed metro line connects the western parts of Kengeri township and the eastern IT corridor to the central business district of MG Road.
“However, we have seen a surge in queries towards north Bengaluru in the last three months. This is because many companies plan to relocate their office spaces towards the north while several new companies keep launching their assets there. Prime areas in CBD area like Outer Ring Road are saturated, and we see major leasing shifting towards the north,” Khedia said.
For 2025, the Executive Centre remains bullish on expansion in Whitefield while exploring new opportunities in north Bengaluru.
Executive Centre to add 50 lakh sq ft of flex space by 2025
The company plans to expand its flex office space portfolio in India by adding over 50 lakh sq ft by the end of 2025.
“We are targeting to grow at more than 20% every year. While our average space for an office centre used to be between 30,000-50,000 sq ft, we are looking at larger spaces between 50,000-80,000 sq ft. So considering this, we are looking to add close to six centres in India by 2025,” Khedia said.
The centres will be located across Chennai, Bengaluru, Hyderabad, Mumbai, Gurugram and New Delhi, he said.
The company’s current portfolio is 1.5 million square feet. It plans to double the footprint to 3 million square feet by 2027.
Last year, the company invested over ₹47 crore in the southern Indian cities of Chennai, Bengaluru and Hyderabad; ₹42 crore in Gurgaon and New Delhi; and ₹33 crore in Mumbai and Pune.
“In 2025, we expect the investment to be on similar lines with southern India accounting for 30% of the overall portfolio share,” said Khedia.
