Offering the twin benefits of space efficiency and cost-effectiveness, the co-working trend is catching the fancy of office occupiers in metros. Currently, there are close to 350 co-working office operators in India working out of 800 locations based in Bengaluru, Mumbai, Delhi NCR, Pune, Chennai and Hyderabad. The nation’s IT capital, Bengaluru, leads the pack of flexible office hubs with a 35 percent share while Mumbai ranks second with almost 18 percent of the total number of co-working offices in the country.
Co-working operators may have started with a small footprint, but they are steadily growing into one of commercial real estate’s fastest growing trends. Due to the growing demand from occupiers, developers such as RMZ Corp, K Raheja and Embassy Group have partnered with local and international operators to make claim a share of the co-working space pie. Among the biggest names to enter India is New York-based co-working startup WeWork that launched its India hub called WeWork Galaxy in Bengaluru offering co-working space to up to 2,200 members. Other renowned international operators such as Awfis and iKeva have also expanded their footprint across major cities over 2017 and have bigger plans for 2018.
Co-working spaces are appealing to a whole cross section of occupiers as they offer them an alternate to rising rents and shortage of space in locations such as Mumbai and Bengaluru. More and more companies are seeking efficient and cost-effective solutions to meet their expansion goals. As a result, the demand for co-working spaces from all sectors including technology, BFSI, telecom, consulting, and logistics and warehousing has grown stronger.
Currently, the market size for the shared office segment across India is around 12-16 million seats. No longer limited to start ups and freelancers, the space is appealing to emerging businesses as well as large corporates. Going forward, both international and domestic players are expected to expand their presence in major cities. Experts predict that the co-working domain in India is likely to receive $400 million in investment by 2018.