GCC boom reshapes coworking business

Unlike traditional coworking arrangements centred on startups and freelancers, managed office mandates from multinational firms offer operators higher revenue per seat, longer lock-in periods and lower client churn, helping improve occupancy visibility and profitability. Industry executives say the shift is steadily transforming flex-space companies into enterprise real estate and services providers rather than pure desk-rental businesses.

The trend is being driven by the rapid expansion of GCCs in India. According to industry estimates, the country hosts around 1,700 GCCs as of 2025, with the sector’s revenue rising from $40.4 billion in FY19 to $64.6 billion in FY24. The market is projected to touch $105 billion by 2030 with nearly 2,400 centres.

Flexible workspace firms are increasingly positioning themselves as plug-and-play operating partners for these centres by offering workspace design, fit-outs, IT infrastructure, food and beverage services and day-to-day facility management under a single contract. “We are seeing first-time GCCs and mid-market global firms entering India for the very first time,” Amit Ramani, chairman and managing director of Awfis, told FE. He said these firms typically begin with 25-50 seats and gradually expand to 100-300 seats as their India operations scale up.

As of Q3 FY26, GCCs contributed 21% of Awfis’ space rental revenue. During the first nine months of FY26, the company secured 12 new GCC mandates, while another 11 are expected to go live between January and June 2026.

What do industry experts say?

Industry experts say enterprise-managed office contracts offer significantly better economics than conventional coworking. “Operators who started out renting desks to freelancers and startups have figured out that an enterprise-managed office contract is simply a better business because of longer tenure, bigger ticket and lower churn,” said Rohan Lobo, partner and GCC industry leader at Deloitte.

Clients with over 200 seats typically sign lock-ins of three to four years, compared to far shorter commitments in traditional coworking. For Awfis, clients with over 100 seats had an average tenure of 49 months and lock-in period of 37 months as of December 2025.

The shift is also benefiting larger operators such as Smartworks. The company entered FY27 with more than Rs 5,200 crore in contracted rental revenue already locked in, covering over 82% of its projected FY27 revenue. Smartworks said the share of GCC-linked rental revenue has doubled from 7% to 15% over the last year.

According to Crisil Ratings, the flexible workspace inventory is expected to expand 16-18% over this and next fiscal to 140-145 million sq ft, supported by rising demand from GCCs, domestic corporates and startups.

However, analysts added that the opportunity may not be limitless. As GCCs scale beyond 1,000 employees, many eventually move to direct leases instead of managed workspaces. The model also remains capital-intensive, with operators investing heavily in fit-outs and working capital before contracts stabilise. “This is a genuine structural shift, but operators who confuse the tailwind for permanence could get caught out in the next cycle,” Lobo said.