Asia Pacific's Flexible Office Sector Predicted To Achieve Remarkable Growth

Flexible offices are sprouting all over the world, in a post-pandemic setting, where many employees still adopt a hybrid form of work. On the other hand, employers are cutting ties with stiff and expensive traditional office spaces and leaning towards more flexibility, a wide range of budgets, and convenient leases.

According to market research company Modor Intelligence, the flexible office market size in the Asia Pacific region is expected to register a compound annual growth rate (CAGR) of higher than 4% for the period 2024-2029, driven in part but the increase in number of startups in the APAC region, led by China.

China has by far the greatest number of unicorns (companies valued at over $1 billion) in the region, with 169, and it’s the second-largest home to unicorns after the US, with 653 (source). India follows China in the region with 70 companies valued at $193 billion, behind the $736 valuation of China’s, crowning New Delhi as the city with the largest growth in the number of co-working centres not only in the APAC region but globally.

In terms of the total volume of flexible office space, the Asia Pacific displays stable growth with the total volume reaching 87 million sq. ft. as of March 2023, an increase of 6% from September 2022, reports CBRE. The proportion of flexible space in Grade A office stock also rose from 3.1% to 3.5% during the same period.

A spokesperson from Compass Offices elaborated, “We are observing a strong trend where companies are actively seeking flexible office solutions, specifically within premium Grade A buildings. These organisations demand the highest quality and top-notch services that only such spaces can offer. The flexibility combined with prestigious addresses and superior amenities is becoming increasingly crucial for businesses aiming to attract top talent and enhance their operational agility in APAC.”

New Delhi and Bangalore added an additional 3.1 million sq. ft of stock in the first quarter of 2023. Hong Kong has around 166 co-working spaces rivalling the number of flex spaces available in London and New York City. In Singapore, co-working spaces have tripled since 2015. Kuala Lumpur and Jakarta are also home to diverse and price-competitive co-working spaces.

Tech firms were the main users of flex office space in the first half of 2023 in the Asia Pacific region.