India’s startup ecosystem has now become a major force driving commercial real estate demand. According to the report Startups Scale Up by CRE Matrix and Colliers India, startups are transforming office leasing trends, workplace preferences, and occupier demand across India’s leading cities.
India currently ranks as the world’s third-largest startup ecosystem, with more than 50,000 recognized startups. Between 2019 and 2021, Indian startups attracted USD 45.2 billion in equity investments, with 2021 accounting for over half of the total inflows. The sector also generated nearly 1.7 lakh jobs in FY 2020–21, highlighting its growing economic contribution.
Startups as the Major Office Occupiers
The report reveals that startups have emerged as one of the fastest-growing office occupier segments in India. Startup office occupancy recorded an impressive 38% CAGR over the last 12 years, significantly outpacing traditional occupier groups.
Their share in total occupied office stock increased from just 3% in 2016 to 10% in 2021. This accounts for approximately 49.7 million sq. ft. across the top six cities. This rapid growth is due to the expansion of existing startups and the rise of new ventures.
The momentum is expected to continue over the next few years. By 2024, startup-occupied office space is projected to reach 78.3 million sq. ft. This will contribute nearly 13% of India’s occupied office stock. Additionally, startups are expected to lease around 29 million sq. ft. during 2022–24 alone.
Bengaluru Leads Startup Leasing Activity
Among India’s office markets, Bengaluru continues to dominate startup leasing with a 34% share during 2019–21. The city’s strong technology ecosystem, deep talent pool, and established startup culture continue to attract both early-stage and unicorn companies.
Delhi-NCR accounted for 20% of startup leasing activity, while Hyderabad captured an 18% share. Mumbai represented 15% of leasing demand despite higher rentals and living costs, while Pune and Chennai also remained important startup destinations.
Unicorn Growth Is Driving Larger Office Deals
India’s unicorn ecosystem has also played a major role in office demand growth. The country added 46 unicorns in 2021 alone, the highest ever in a single year. Leasing activity by unicorns increased by 77% during 2019–21, driven by workforce expansion and rapid business scaling.
Sectors such as FinTech, RetailTech, EdTech, FoodTech, Logistics, and HealthTech are expected to contribute more than 50% of startup office demand over the next few years. As these companies continue to scale, demand for larger Grade A office spaces and managed workspaces is likely to rise further.
Non-Metro Emerging as Startup Hubs
The report also highlights the growing importance of non-metro cities in India’s startup landscape. Around 40% of startups founded in 2021 originated from emerging cities, supported by lower operating costs, improved internet infrastructure, and access to skilled talent.
This trend is creating fresh opportunities for flexible and managed office operators in Tier-2 cities. As startups increasingly adopt distributed workforce models, demand for plug-and-play office spaces outside major metros is expected to grow steadily in the coming years.
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Mention Mentions
- Construction Week: Startups to lease 29 mn sq ft during 2022-24: Colliers-CRE Matrix.
- CNBC 18: Startups to lease 30% more office space in 2022-24 in 6 cities: Report.
- ET Realty: Startups to lease 29 million sq ft office space in 2022-24 in six cities: Report.
- Money Control: Startups likely to raise 29 million sq ft in 2022 -24, fintech and logistics to drive demand.
