AI pushes India's C‑suite to flexible offices: Report
New Delhi, Aug 11
Sixty per cent of CEOs and CFOs in India said the rise of artificial intelligence has made it impossible to predict how much office space they will need in two years, prompting a shift to flexible, capital‑light workspace models, a report said on Tuesday.
The report from International Workplace Group (IWG) said 73 per cent leaders are less willing to commit to long‑term leases because of rapid technological change including AI-led transformations.
Nearly 99.8 per cent of CEOs and CFOs said their organisations are actively moving real estate costs from fixed to more variable spend, while 55 per cent are considering networks of locations closer to where employees live.
The report also said 76 per cent of CEOs believe the office will actually become more important over the next two years, but companies are increasingly looking for the flexibility to scale their workspace rather than being locked into a single location.
"India is already experiencing this transition at scale. The country has the world's highest workplace AI adoption, with 73 per cent of professionals regularly using AI tools," the report said.
While Global Capability Centres (GCCs) operating in India are expected to exceed 2,400 by 2030, employing around 2.8 million people, they are already the largest customer segment for new office space, accounting for 45.5 per cent of gross office leasing in Q1 2026
Nearly 88 per cent of CEOs said AI-adoption led to organisations requiring flexibility in their workspace or real estate solutions as rapid technological change makes it incredibly difficult to anticipate future space needs.
"AI is accelerating the pace of change for every business, and companies that want to succeed need workplace strategies that allow them to scale up or down quickly, reduce unnecessary fixed costs and give their people access to high-quality workspace wherever they need it," said Christian Schmitz, CEO of International Workplace Group.
"India is one of the clearest examples of how AI adoption, and changing workforce expectations are reshaping office demand...We're increasingly seeing companies build workplace networks across metro and Tier-2 cities so they can access talent, reduce commuting times and scale much more quickly," said Harsh Lambah, Country Head, IWG India
— IANS
Reader Comments
This is so true! I work in a GCC in Pune and we've literally halved our office footprint in the last year. My team is spread across 3 different co-working spaces near where people actually live. The commute reduction alone has improved my quality of life massively. AI tools let us collaborate seamlessly from anywhere. India is leading this shift and that's something to be proud of.
Smart move by Indian leadership. In the West we're still stuck in legacy real estate thinking. The flexibility to scale up or down with AI-driven demand is the only rational approach. I wonder if our GCCs are going to push their parent companies toward this model globally.
I appreciate the flexibility, but let me play devil's advocate here. 🤔 All this "variable spend" sounds good until you realize that startups and even mid-sized companies are losing the stability that a dedicated office provides. Culture building, spontaneous collaboration, mentorship of junior staff - these things suffer when everyone is in flexible pods. Yes to flexible, but mixed with some core permanent space. It's about balance, not just cutting costs. But yes, the old 100-year lease model is definitely outdated.
As someone who works with Indian firms, the stats don't surprise me. India's 73% AI adoption is way ahead of many markets. The move to Tier-2 cities for office networks is genius - you get quality talent at a fraction of the cost, and employees are happier with shorter commutes. I'd love to see more companies worldwide follow this India blueprint. 🌟
We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.