India’s Flex Office Sector Eyes $10 Billion Valuation by 2028: myHQ by ANAROCK Report

India’s flexible workspace sector has entered a transformative phase, crossing the landmark 100 million sq ft mark and positioning itself for a projected valuation of $9–10 billion by 2028. According to the Q3 FY26 Flex Office Report released by myHQ in collaboration with ANAROCK, the industry is now transitioning from aggressive expansion to a more sustainable, profitability-driven growth model.

The report highlights a clear structural shift in demand dynamics. Unlike earlier years dominated by startups and small businesses, large enterprises are now the primary drivers of growth, bringing greater stability, long-term occupancy, and predictable revenue streams to operators across markets.

A major catalyst behind this transformation is the rapid rise of Global Capability Centres (GCCs), which now contribute approximately 35–40% of total leasing activity in recent quarters. This surge in enterprise demand is also reflected in deal sizes, which have more than doubled—from an average of 25 seats in 2023 to 53 seats in 2025—indicating growing confidence in flexible workspaces as a core component of corporate real estate strategies.

The BFSI sector has also significantly expanded its presence in coworking spaces, further reinforcing trust in the compliance standards, infrastructure quality, and operational reliability offered by flex operators. Improved utilisation rates, stronger operating leverage, and increasing enterprise adoption are collectively strengthening the sector’s long-term growth trajectory.

Utkarsh Kawatra, Co-Founder & CEO of myHQ, emphasized that the industry has crossed a defining threshold. He noted that flex workspace providers are no longer just competing among themselves but are now directly challenging traditional commercial real estate by offering superior flexibility, faster deployment, and better capital efficiency. Importantly, he highlighted that multiple listed operators achieving profitability in the same quarter marks a critical milestone, validating the sector’s evolving business model.

On the supply side, operators are scaling through large-format campus developments while expanding into emerging Tier-1.5 and Tier-2 markets. Significant additions have been recorded in major cities such as Mumbai, Bengaluru, and Hyderabad. In a notable transaction, DevX secured a 27-storey tower deal in Ahmedabad valued at ₹850 crore in rentals—one of the largest single-property deals in the sector—highlighting growing confidence in large-scale flexible workspace infrastructure.

Key micro-markets gaining traction include Sarjapur and Hebbal in Bengaluru, Kokapet in Hyderabad, Hinjewadi in Pune, and OMR in Chennai. Additionally, Tier-2 cities such as Ahmedabad, Kochi, and Indore are emerging as strong growth corridors, supported by increasing enterprise demand and infrastructure development.

Beyond conventional workspace offerings, operators are actively diversifying their revenue streams. New on-demand products such as Executive Day Passes and Private Cabins are gaining popularity, catering to evolving hybrid work models and short-term workspace needs. Value-added services (VAS)—including IT support, food and beverage, parking, and office fit-outs—now contribute between 13% and 16% of total revenues for several operators.

The MICE (Meetings, Incentives, Conferences, and Exhibitions) segment is also emerging as a high-margin vertical, enabling operators to optimize occupancy levels and generate additional revenue. By monetising existing infrastructure through events and flexible offerings, coworking spaces are increasingly positioning themselves as integrated work-and-experience hubs.

Institutional participation in the sector is rising steadily, with increased investments from global funds and a growing pipeline of initial public offerings (IPOs). As the market matures, consolidation is expected to accelerate, with larger players acquiring smaller operators—particularly in high-growth Tier-2 markets. The report also suggests a shift in valuation benchmarks, with profitability gaining more importance over traditional EBITDA metrics.

Operator-level insights reveal strong performance across key industry players. IndiQube has recorded significant desk growth, while Smartworks has increased its average centre sizes. WeWork India continues to lead in revenue per member, and EFC Limited reported the highest absolute profit among listed operators for the quarter. Meanwhile, Awfis has emerged as a leader in value-added services despite facing some occupancy challenges.

In a landmark development, multiple listed operators—including WeWork India, Smartworks, Awfis, and EFC—reported net profitability simultaneously in Q3 FY26 for the first time. This milestone marks a decisive shift from growth-led expansion to profitability-led consolidation, reinforcing the sector’s long-term viability.

While global macroeconomic volatility and geopolitical risks may pose challenges to GCC expansion pipelines, enterprise demand in India has remained resilient through previous cycles of uncertainty. The report concludes that crossing the 100 MSF threshold is not the peak of the flex workspace story but rather the foundation for its next phase of growth.

Overall, the Q3 FY26 myHQ Flex Office Report serves as a critical benchmark for developers, occupiers, and HR leaders navigating the evolving future of work in India, highlighting a sector that is rapidly maturing into a stable, scalable, and high-growth asset class.

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