70% of CRE leaders back dual cost savings and transformation: Knight Frank
Synopsis
The old real estate playbook — cut costs first, invest later — is being discarded. Knight Frank's global survey finds nearly 71% of CRE leaders now believe cost savings and long-term transformation can happen together. India is the standout proof point: office leasing hit 86.4 million sq ft in 2025, 43% above the pre-pandemic peak, with GCCs and flexible spaces driving a structural, not cyclical, surge.
Key Takeaways
70.8 per cent of CRE leaders surveyed by Knight Frank believe organisations can pursue cost savings and long-term transformation simultaneously.
More than 53 per cent expect CRE teams to take on strategic roles in talent management, risk mitigation, and enterprise transformation.
50.8 per cent of organisations are willing to integrate AI into workplace operations to boost productivity.
India's office leasing reached 86.4 million sq ft in 2025 — up 20 per cent YoY and 43 per cent above the 2019 pre-pandemic peak.
GCCs accounted for 38 per cent of total office absorption at 32.6 million sq ft .
Flexible workspace operators leased a record 18.6 million sq ft in 2025, up 18 per cent year-on-year; Grade A assets made up 91 per cent of all transactions.
Corporate real estate (CRE) leaders globally are abandoning the traditional step-by-step playbook — where efficiency gains had to precede strategic investment — and are instead pursuing cost optimisation and long-term transformation simultaneously, according to a Knight Frank report released on Tuesday, 4 August 2025.
Key Survey Findings
The report, based on a global survey of senior CRE executives, found that 70.8 per cent of respondents believe organisations can deliver immediate cost savings while continuing to invest in long-term transformation initiatives. This marks a decisive shift in how corporate occupiers are approaching real estate strategy.
More than 53 per cent of respondents also expect CRE teams to take on a broader strategic role — extending beyond space management into areas such as talent management, risk mitigation, and enterprise-wide business transformation.
AI and Technology as Workplace Enablers
Technology is emerging as a central enabler of this dual-track approach. 50.8 per cent of organisations surveyed said they are willing to integrate artificial intelligence into workplace operations to improve productivity. Notably, the report found that companies are gravitating toward targeted AI deployment within core workflows, rather than undertaking large-scale workplace redesigns.
This comes amid a broader global shift among occupiers — away from expansion-led real estate strategies and toward optimising existing portfolios while investing in high-quality, sustainable workplaces designed to foster collaboration, learning, and innovation.
India Stands Out as a Growth Market
While global occupiers are consolidating, India continues to buck the trend. Office leasing across the country's major markets reached 86.4 million sq ft in 2025, a 20 per cent increase year-on-year and 43 per cent above the pre-pandemic peak recorded in 2019.
Global Capability Centres (GCCs) were the primary demand driver, leasing 32.6 million sq ft — accounting for 38 per cent of total office absorption. These centres are increasingly taking on higher-value functions spanning technology, analytics, research, and product development.
Flexible Workspaces and Premium Assets Gain Ground
Flexible workspace operators leased a record 18.6 million sq ft in 2025, up 18 per cent from the previous year. Meanwhile, Grade A assets accounted for 91 per cent of all office leasing transactions, reflecting a clear occupier preference for premium, future-ready buildings.
Shishir Baijal, International Partner, Chairman and Managing Director of Knight Frank India, said: 'India's strong leasing performance reflects its growing strategic relevance in global corporate real estate strategies. Corporate real estate leaders today are expected to deliver cost efficiency and transformation in parallel, and the findings indicate that these are no longer competing priorities but aligned drivers shaping workplace decisions.'
What This Means Going Forward
The convergence of cost discipline and strategic investment signals a maturation of the CRE function — from a back-office cost centre to a boardroom-level driver of business outcomes. For India, with GCC expansion still accelerating and flexible workspace demand at record highs, the structural tailwinds appear durable heading into 2026.
Point of View
Grade A, sustainable workspaces at the same time demands capital discipline that most mid-tier occupiers do not have. India's leasing numbers are genuinely exceptional, but 38% of absorption being GCC-driven means the market is increasingly dependent on a single demand segment whose growth is partly a function of US and European offshoring decisions outside India's control. The flexible workspace surge — record 18.6 million sq ft — is encouraging, but also raises questions about whether underlying demand is as committed as headline absorption suggests. The structural story is real; the concentration risk is underreported.
NationPress
4 Aug 2026
Frequently Asked Questions
What did the Knight Frank CRE survey find?
The Knight Frank survey of senior corporate real estate executives found that 70.8 per cent of respondents believe organisations can achieve immediate cost savings while simultaneously investing in long-term transformation. More than 53 per cent also expect CRE teams to take on broader strategic roles beyond space management.
How is AI being used in corporate real estate?
According to the report, 50.8 per cent of organisations are willing to integrate artificial intelligence into workplace operations to improve productivity. Companies are focusing on targeted AI deployment within core workflows rather than large-scale workplace overhauls.
How did India's office leasing perform in 2025?
India's office leasing across major markets reached 86.4 million sq ft in 2025, a 20 per cent increase year-on-year and 43 per cent higher than the pre-pandemic peak of 2019. Global Capability Centres drove the bulk of this demand, leasing 32.6 million sq ft.
What role are GCCs playing in India's office market?
Global Capability Centres (GCCs) accounted for 38 per cent of total office absorption in India in 2025, leasing 32.6 million sq ft. These centres are increasingly handling higher-value functions in technology, analytics, research, and product development.
What is the trend in flexible workspaces and Grade A offices in India?
Flexible workspace operators leased a record 18.6 million sq ft in 2025, up 18 per cent from the previous year. Grade A assets dominated the market, accounting for 91 per cent of all office leasing transactions, reflecting strong occupier preference for premium buildings.
