Rising demand for shared renting or co-living is expected to offer a business opportunity of Rs one trillion and 5.7 million beds by 2023 while Delhi-NCR is likely to constitute nearly 40 percent of this potential.
According to the report, Co-Living - Reshaping Rental Housing in India, the rising demand for shared renting will propel the market.
Another report Co-Working - Reshaping Indian Workplaces said that demand from corporates, startups and entrepreneurs has resulted in a huge jump in the co-working share in total office leasing. The share has risen to 12 percent in the first quarter (January-March) of 2019 from 8 percent level seen in 2018. As much as 6.9 mn sq ft of cumulative space has been absorbed by co-working segment from 2017 to first quarter of 2019, the report said.
The two reports were released at a JLL-FICCI conference on The Future of Indian Real Estate: Conference on Co-working and Co-living Spaces.
"Today millennials constitute a majority of India’s workforce. They are adaptive but expect a drastic change to occur in the way people work. Agile workplaces and a vibrant ambience helps the new workforce deliver better. While the concept has readily been accepted in the metros, Tier II cities are also opening up to this new concept, including Indore, Ahmedabad, Bhubaneshwar, Kochi and Jaipur," said Sanjay Dutt, chairman, FICCI Real Estate Committee & MD & CEO, Tata Realty and Infrastructure Ltd.
Juggy Marwaha, executive managing director, JLL India said: "Co-working segment has come a long way in the country and is now riding a maturity curve and getting more established. Operators within this mature market now offer multiple formats to occupiers. These range from entire buildings dedicated to co-working spaces to built-to-suit co-working offices within the conventional workplaces. With the benefits of cost reduction and shared amenities, the segment provides a tremendous business potential to all – developers and occupiers."
"Globally, evolving nature of workplaces and human experience have become core to the office sector. Shift in perception amongst millennials to ‘sharing’ instead of ‘owning’ has made the co-living concept popular. For all groups - corporate occupiers, start-ups, entrepreneurs and millennials – renting offers flexibility and savings. Co-working offers cost savings of 20-25 percent compared to traditional office space leasing. Co-living offers attractive returns, 2 to 4 times higher than traditional residential yield of 2-3 percent," said Samantak Das, Chief Economist and Head of Research & REIS, JLL India.
"With these two innovative segments, Indian office and residential real estate is sure to grow bigger and better. However, stakeholders need to address existing challenges such as issues related to data privacy, the conservative approach of property owners and relevant supply observed across co-working and co-living, respectively," added Das.