Manas Mehrotra, Founder, 315Work Avenue, a leading coworking space provider
The concept of workspaces and the way we perceive workspaces strategies have evolved significantly in recent years. Commercial Real Estate (CRE) is on the edge of a transformation as coworking spaces have become a highly popular choice for businesses of different kinds and dimensions due to multiple advantages. Amid transformations of the office real estate market, it is evident that tech companies are having a significant bearing on office space leasing in India. A significant surge in demand has been observed among domestic companies too, particularly those from the engineering and manufacturing sectors who are increasingly taking up office leasing.
The co-working sector has expanded and demand has gained great traction with corporates and MNCs making a beeline to coworking spaces in 2023 that have emerged as strong centres of growth. We saw a lot of companies gaining from the hub and spoke and decentralized model that coworking spaces adopted with the idea of making offices easily accessible to employees and enhance productivity. We have witnessed maximum traction for seats ranging between 100-500 and in few cases goes above 1000 seats. Bengaluru was among the most preferred locations for flex players for their expansion in recent times.
While flex spaces continued to perform well in 2023, we believe the share of flex space in overall leasing to grow further and the companies exhibiting value added services to the clientele will continue to thrive. India continues to be the fastest growing flex office market in the APAC region and is set to account for one-fifth of the office market by 2030. The coworking sector’s impact is poised to amplify in the future, driven by the fundamental transformation work dynamics have undergone which is unlikely to revert. The demand for coworking spaces is expected to grow at around 15-20 per cent over the next two to three years and if the macro fundamentals remain stable, the growth will be higher. Formulating hybrid working rules and policies that balance business goals with workforce needs would be at the top of occupiers’ agendas.
As businesses increasingly shift offices from traditional and conventional set ups to coworking spaces, commercial real estate operators will increasingly lease space to flexible operators and both will grow exponentially and co-exist in a win-win situation. Overall, companies are aspiring to keep pace with the economic engine and are looking out for workspaces that meet new office requirements of the changing economy and coworking spaces help them fill a unique void. Flexible spaces are becoming mainstream now.
