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An Overview of Coworking Spaces In India
There is a lot of noise about the term “Co-working“ at almost all the workplaces. so, what is co-working? Coworking the situation in which several workers from different companies share an office space, allowing cost savings and convenience through the use of common infrastructures, such as equipment, utilities, receptionist and custodial services.
It is attractive to work-at-home professionals, freelancers, independent consultants, solopreneur, and people who travel frequently and otherwise end up working in relative isolation. We are discussing here the coworking space in India.
What is the concept of Co-working?
Co-working spaces are a type of shared office that generally involves an open environment located either in high-rises or old sites reconfigured for these new ways of living. Co-working is not only about the physical place but about establishing a community.
The term co-working was coined in 1999 to describe computer-supported collaborative work. And the first coworking centers, the Hat Factory, and Citizen Space, both in San Francisco were established in 2006.
WeWork the American coworking company is the biggest and largest coworking company having a workforce of 5000 employees with 836 open and coming soon locations in the 38 countries. Regus, a European company founded in 1989 that operates in 120 countries and 900 cities (mainly in the United States) is one of the companies has pioneered the shared office space concept very early.
How Does a Co-working space work?
These new spaces benefit a community of professionals including entrepreneurs, freelancers, and small businesses that require spaces at affordable prices where there is the possibility of networking with other professionals. These cooperative work environments require shared spaces and resources such as high-speed internet, desks, chairs, lamps, filing cabinets, printers, copiers, kitchens, and telephone booths in strategic areas of the city.
The coworking spaces in India, therefore, is destined to become a shared economy where intangible profits and interpersonal relationships are highly valued.
As per our finding as in September 2019, there are over 1000 coworking spaces in India, and while most of these are concentrated in Delhi NCR, Mumbai, Bengaluru, Chennai, Hyderabad, & Pune. over 200 are in Tier II and III cities as the coworking sector in India is flourishing and growing. The majority of coworking members work in an open office environment. Team and individual offices are also, available in the industry.
Coworking spaces today have become very popular and are seeing exponential growth in India. As in 2019 India is the second-largest market for flexible workspaces in APAC, after China.
Number of Coworking Spaces Worldwide
According to the Statista website, there were 18,700 coworking spaces operating worldwide in 2018, a number that is expected to reach 22,400 by the end of 2019. It was additionally recorded that the region with the most coworking spaces was Asia Pacific (including India), with 11,592 spaces, followed by Europe, the Middle East, and finally Africa, with 6,850 spaces.
The number of coworking spaces worldwide is projected to soon cross 20,000 and reach 25,968 by 2022, an increase of 42% from 2019. This would also mean that there has been an average increase of 2,595 new spaces every year since 2015. Looking at the number of WeWork spaces and boutique spaces around us today, this shouldn’t come as a surprise.
The Coworking industry is expected to grow
3 times by 2021, established itself as a fundamental part of the Commercial Real Estate (CRE) leasing activity
Who uses Co-working space?
Millennials and Gen Z employees are seeking flexibility, mobility, collaboration, and options that help them work real-time and untethered. Shared workspaces enable flexibility by providing solutions such as national pass, roaming, and bulk meeting room hours to work out of any location, without any restriction and hassle of booking each time.
Coworking spaces in India and everywhere are mostly used by;
- Work- At Home professionals
- Soloprenuers (One person Company)
- Early Stage Founder
- Independent Consultant/Contractor
- Small Businesses
- Remote/ Branch Office
- Virtual offices
Nowadays, corporate houses also, checking into the co-working spaces.
What Services the Coworking spaces in India offer?
Main benefits of the co-working spaces include;
- Furnished offices and conference rooms.
- Shared facilities like WiFi Internet, communal printer, copier, Fax machines, projector, flipcharts, printers, phones, scans, bookbinder, Whiteboard, paper, etc.
- Free Parking, CCTV, gaming area, etc
- Cafeteria, kitchens, Water, coffee, and snacks
- Air Conditioned Workspace
- Clean office Environment
- Reception Area
- Office Stationery
- Sleeping Pods
- Stress reliving area
- Couriers and Packages Handling
- Training room
- Fully Equipped Pantry
- Power Backup
- Concierge Services
- Access to Community
- Business Address
- Premium Cabin Spaces
- IT facilities
- lounge, recreation rooms
- Storage capacity
What are the benefits of Co-working?
Coworking Spaces in India and everywhere mostly offered the following comforts;
- Personalized Desk (Own Desk)
- New Business
- Increased Well Being
- Collaborative Environment,
- Advice, Support, Promotion, Mentor
- No Distractions
- Stay inspired
- Better work/life balance
- Better Health and Happiness
- Location choices
- Excellent Coworkers,
- Meeting spaces,
- Quiet spaces,
- 24 hr Access
- Event Spaces
Who are the major players in Co-working spaces in India?
The number of co-working spaces across the globe has grown by 3,050% since 2010 while the number of people working in these facilities has exploded by close to 8,000% in the same period by growing from 21,000 seats to 1.7 mn seats, according to Statista.
Listed down some of the market leaders in the coworking spaces in India based on the google review. All these coworking space includes the affordable coworking space Mumbai, best coworking spaces in Mumbai, coworking space Pune, coworking Bangalore, coworking Delhi, coworking Noida and also from the other major Indian cities.
- 91 Springboard
- Vatika Business Center & Coworking spaces
- The Hive
- Commune Coworks
- Ministry of New
- The Daftar
- The Office Pass
- Corporateedge Horizon center
- Spacejam Coworking
- Hustle Cowork
- The Hub
- Ecosphere Coworking
- Rise Mumbai
How does a Co-working space charge?
Most of the co-working spaces charge on the basis of per seat occupant. The cost per seat starts from 3500 per seat to 25,000 Per seat for the offices and solo-prenuers. Every company has its own structure to charge for the occupancy.
- In Mumbai, 21% of all office rentals were those of co-working spaces.
- Co-working has now established itself as a fundamental part of the Commercial Real Estate (CRE) leasing activity and a full-fledged sector in its own right, giving tough competition to conventional office spaces.
- More than 200 companies running these spaces in the country as in 2019.
- Coworking spaces in India such as CoWrks, Awfis, Smartworks, and Oyo-owned Innov8, have generated strong investor interest.
- The leasing of office space stood at 3 million sq ft in January-June 2018 and 8.3 million sq ft for the entire previous year across cities like Delhi-NCR, Bengaluru, Mumbai, Chennai, Hyderabad, Kolkata, and Pune.
- CBRE also highlighted that co-working operators were now focusing on tier-II cities as well, including Lucknow, Jaipur, Chandigarh, and Goa.
- A JLL, CBRE report says, co-working spaces have disrupted the commercial real estate segment in India with approximately 325-330 coworking operators in the top cities, and the average transaction size increasing from 52,000 per sqft in 2018 to 77,000 per sqft in Q1 of 2019.
- Yogi Adityanath government in UP is keen on promoting start-ups and the culture of co-working spaces in the state, especially in Lucknow.
- Co-working players are curating unique experiences and engagements for building tenants by providing state-of-the-art amenities like gyms, cafés, creches and managing the complete building ecosystem by bringing alliances, events and community focus to the occupants.
- Recently, OYO Hotels and Homes acquired Delhi-NCR-based Innov8 for Rs 220 crore and made its entry into the co-working space.
- India is the second-largest market for flexible workspaces in APAC, second only to China.
- While co-working spaces were initially preferred mostly by smaller companies and startups, today they are also preferred by large and medium-sized businesses for their affordable infrastructure and business opportunities.
- The concept of co-working also not restricted to larger cities, tier-II cities like Chandigarh, Ahmedabad, Kochi, Indore, Nagpur, and Jaipur too are following the trend.
- With India being called the second-largest hub for startups globally, the co-working market is also saturated with players with different scale of operations.
- The overall flexible space stock in India has increased by about 50%, from 10 million sq. ft. in 2017to about 15 million sq. ft. by Q3 2018; positioning it amongst the largest flexible space markets in the entire APAC region. This is almost 2.7% of the overall commercial office stock of India.
- As of 2019, the co-working industry in India makes up for 10-12 percent of the total leasing market.
- Currently, a co-working space either leases or opens itself in commercial premises so with deeper penetration with more affordable prices, people might slowly drift towards these modern workplaces.
- JLL, a global real estate services firm estimates that the co-working space in India rose three-fold to 3.4 million sq. ft over the first nine months of 2018
- By 2020, the estimate is that 13 million people will work out of a co-working space in India.
- The industry is expected to grow 3X by 2021, leading to massive opportunities for the co-working business in the country.
- By 2020, millennials are expected to make up about 50% of the workforce and, by 2025, this number is projected to be 75%.
- As per the report of a real estate consulting firm Anarock, at the end of 2018, more than 400 co-working spaces were operating in India, and Anarock expects the number to grow three-fold in two years.
- According to realty consultant CBRE, working place lease by companies providing flexible workplace rose 52% to 4.6 million square feet (sq ft) during the first half of 2019 across 7 major cities on rising demand from start-ups and corporates.
- coworking spaces in markets Tier-II cities are expected to grow to 8.5 mn seats by 2020.
- CBRE expects space take-up from flexible space operators to rise from about 4 million sq. ft. in 2018 to about 7-9 million sq. ft. by 2020.
- Currently, valued at around $1 Billion, the valuation might grow to $ 7-8 Billion by 2022, for this workspace sector.
By successfully capitalizing on the concept of the shared office workspace, co-working has remodeled the commercial real estate (CRE) market. Thus, given the strong demand and stimulus that it has been able to accumulate, it wouldn’t be an overestimation to suggest that the best is yet to come for a segment that is still in the nascent stages of development.