Co-working share in office real estate hits 27% in Q1
Bengaluru and Delhi-NCR together accounted for 66% of net co-working absorption in Q1 2023
image for illustrative purpose
New Delhi: Demand for flexible office spaces has hit a new high after the pandemic amid the hybrid work culture, with co-working share in office real estate reaching 27 per cent in January-March period (Q1 2023), up from 14 per cent in Q1 2019, a new report showed on Tuesday.
Major companies and businesses including startups are now increasingly opting for co-working spaces, according to latest Anarock data.
Out of a net absorption of approximately 8.2 million square feet across the top seven cities in Q1 2023, co-working spaces had a 27 per cent share. Among the top cities, Bengaluru and Delhi-NCR together accounted for 66 per cent (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 co-working spaces absorbed in the same period. In terms of overall growth in co-working demand, the top seven cities witnessed a 90 per cent growth in net absorption in this period.
Besides startups and other businesses, many IT/ITeS companies also prefer flexible spaces over regular office spaces today, with a strong emphasis on workspace flexibility for employees, said the report.
"Coworking 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 companies continue to follow a hybrid working culture, which involves setting up smaller satellite offices or remote teams using neighbourhood, 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.
