In recent times, co-working spaces have gained massive traction in the global real estate industry, transforming from a minimalistic shared office concept to a lifestyle choice. India, leading the surge in global trends, has seen its co-working sector flourish in leaps and bounds, from the 471,000 seats in 30 million square feet in 2019 to the estimated 1 million seats by 2025.
JLL, a leading global real estate advisory, performed the research for the Indian co-working segment, finding that by the end of June 2022, it had reached 680,000 seats, making it a significant part of the commercial real estate market. Although it faced initial set-backs due to the pandemic and faced disruptions, co-working spaces have been crucial to the market’s recovery, offering related businesses much-needed relief and flexibility.
For the occupiers, there is tremendous value offered by these shared spaces, allowing them to avoid unnecessary costs associated with regular office premises—reducing the spend in leases, preparations, and focuses on their core operations. Many of these occupiers are MNCs, family offices, BFSIs, and other big tech companies, signaling a shift in the shared spaces’ target audience from start-ups, freelancers, and small enterprises to larger firms.
Moreover, with MNCs, BFSIs, tech companies, and other big businesses leasing seats in Tier 2 and 3 cities like Lucknow, Indore, Coimbatore, Vizag and more, the demand for local and flexible spaces is skyrocketing. The appeal of co-working lies in their flexible nature, which makes up- or downscaling depending on requirement easy and hassle-free.
Benefit-wise, occupiers can now enjoy a range of amenities at co-working spaces, helping them to further optimize their productivity and relax. These range from spacious lounges with entertainment options, gaming and fitness facilities, to networking and collaboration areas. Moreover, the lease agreements are on much shorter terms when compared to regular office spaces, typically falling in the range of 9-12 months whereas regular ones can reach up to 5-9 years.
Not only occupiers, but the pandemic has also made remote working en masse. Therefore, it stands to reason that co-working spaces have become essential for this large majority of the workforce working from home, helping them to achieve a professional environment through leasing workspaces. Large corporates such as Amazon and Accenture are now opening these centers in smaller cities so that employees can work in an efficient atmosphere and not be confined to the monotony of home.
In conclusion, India’s co-working sector is expanding with tremendous speed meeting the demands of big businesses as well as remote workers. So much so that it is projected that the number of seats in the segment will surpass 1 million by 2025. Nowadays, co-working is considered an attractive option for its sustainable and flexible solutions, and its ability to increase the overall productivity of its occupants. Thus, it is no longer just a shared office concept, but a lifestyle choice for sustainability.
