Private equity investments in India’s flexible office space sector reached USD 30.9 mn across two deals in H1 2026, exceeding the USD 24.3 mn deployed through four deals during all of 2025, according to Knight Frank India. The figures point to renewed investor interest in a segment that has been moving towards larger operators and greater consolidation.

Knight Frank said investors are assessing enterprise exposure, operating capabilities and scalability as the market develops beyond a period of rapid operator proliferation. The consultancy linked the H1 2026 increase to larger-ticket transactions and said it could indicate a renewed acceleration in capital deployment.

Investment in the sector rose from USD 25.3 mn in 2017 to USD 112.3 mn in 2019, before the pandemic disrupted the cycle. Inflows later reached USD 594.5 mn across nine deals in 2022, the highest annual level during the period, before moderating as the market shifted towards consolidation. Flex transactions also increased from 2.2 mn square feet in 2017 to 18.6 mn square feet in 2025, representing a 30 per cent compound annual growth rate.

Flex space accounted for 24 per cent of office absorption across the leading eight Indian cities in H1 2026, compared with 4 per cent in H1 2017. Leasing stood at 11.4 mn square feet during the first half, led by Bengaluru with 2.9 mn square feet. Pune and the National Capital Region recorded 2.2 mn square feet each, while Hyderabad accounted for 2 mn square feet.

Large enterprises represented 72 per cent of seats in flex spaces, while Global Capability Centres contributed 52 per cent of demand. Knight Frank said the growing participation of large organisations and Global Capability Centres, alongside rising adoption of flexible arrangements, indicated that flex space was becoming a structural component of India’s office market. The shift allows businesses to align real estate capacity more closely with changing growth requirements and location needs.