With the growing demand for remote work and hybrid working models, the need for flexible office spaces has increased recently. A new report shows by Anarock data that co-working share in office real estate reached 27% in the January-March period (Q1 2023), up from 14% in Q1 2019.
Anarock data report further reveals big enterprises and businesses, including startups, are increasingly opting for co-working spaces.
Among the top cities, Bengaluru and Delhi-NCR together accounted for 66% (about 1.43 million square feet) of net co-working absorption in Q1 2023.
Pune and Chennai together saw nearly 0.52 million square feet of coworking spaces absorbed in the same period.
In terms of overall growth in co-working demand, the top seven cities witnessed a 90% growth in net absorption in this period.
Besides startups and other companies, many IT/ITeS firms also prefer flexible working spaces over regular office spaces today, with a strong emphasis on workspace flexibility for employees, said the report.
“Co-working spaces demand weakened considerably after Covid-19 disrupted the workplaces equation across the country. We’re seeing a decisive reversal of this negative trend now, with coworking particularly attractive because of the disrupted IT/ITeS employment scenario,” said Utkarsh Kawatra, Senior Director, myHQ (Anarock Group).
In IT/ITeS-driven cities like Bengaluru, Chennai, and Pune, the relatively low vacancy levels in Grade A offices have spurred the demand for co-working spaces.
“This is also the case with Delhi-NCR, where low commercial space vacancy levels have fostered a rich growth environment for coworking setups in areas such as Gurugram and Noida,” said Kawatra.
Many organizations allow employees to follow hybrid working model, which involves setting up smaller satellite offices or remote teams using neighborhood, on-demand co-working spaces.
“Going forward, we are likely to see developers of commercial office assets across the country align with such operators and carve out specialised coworking spaces for them,” the report mentioned.
The future of co-working spaces is likely to be shaped by the evolving demands of remote workers and entrepreneurs and the broader societal trends driving the shift towards more flexible work models.
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