Co-Working Has Arrived and It's Here to Stay

Make no mistake co-working has arrived. That comes from surging demand for adaptable workplaces along with corporates embracing optimized capital usage so much so that co-working share has jumped 20 percent in the office space leasing segment all in the back-to-back quarters January-June, posits a study by Anarock.

In terms of city-wise absorption, Pune leads the co-working bandwagon, with as much as 45 percent out of the leased office space of 2.55 million square feet coming from flex space absorption.

Bengaluru is not behind either. Of the 6.1 million square feet of net rented office space in the initial half year of this current year, the portion of collaborating space was 23 percent.

Delh-NCR and Chennai accounted for 15 percent out of all net renting of office space at 2.75 million square feet and 1.85 million square feet, respectively.

In Mumbai Metropolitan Region (MMR), the net renting of office space was 2.9 million square feet, of which 11 percent was contributed by coworking players.

Hyderabad saw 4.25 million square feet of net renting of office space and the cooperating share in it was 13 percent, while Kolkata saw renting of 0.4 million square with a co-working portion of 14 percent.

By contrast, the share of IT/ITeS occupancy declined from 49 percent in H1 2021 to 36 percent in H2 2022, pointing to an underlying shift where IT organizations are beginning to favor adaptable spaces to normal office spaces.

Enterprises favor co-working hubs, which include supervised office space, to cut capital use and appreciate adaptability in increasing or down their organizations.

Interestingly, co-working can be stereotyped as urban with the demand for such spaces cutting across regions in India. Likewise, it's no longer limited to spaces that conventionally dominate co-working, like satellite offices or collaboration centres. Even avenues like shopping centres and inns now lay claim to co-working.

From an operations standpoint, co-working spaces offer greater viability. For example, it takes about 4-5 years in lock-in terms before a standard office room can be occupied whereas co-working is plug and play with absolute minimal commitment towards office layouts and fit-outs.

With co-working generating so much business interest, key players are jumping into the test waters, including WeWork India, Smartworks, Awfis, CoWrks, The Executive Centre, Skootr, Simpliwork Offices, IndiQube, The Office Pass, 91Springboard, and 315Work Avenue Road.

Smartworks for example expects an almost three-fold hike in its income this financial year to Rs 1,000 crore. It expects to build its portfolio to 10 million square feet toward the finish of this monetary year from 7 million square feet. The outlook for others is no different, point to that co-working has arrived and is here to stay!