Net absorption of co-working spaces across the top seven cities touched 8.2 million square feet (msf) in Q1 of the calendar year of 2023. Then we have to mention it), with a share of 27 percent, from a 14 percent share in the pre-pandemic year of 2019, according to real-estate consultant ANAROCK.
Overall, the top seven cities saw 90 percent growth in net co-working space absorption in this period – from 1.3 msf in Q1 of 2019 to 2.18 msf in Q1 of 2023.
Bengaluru & NCR accounted for 66 percent of net co-working absorption in Q1 of 2023, with about 1.43 msf.
"Besides startups and other businesses, many IT/ITeS companies also prefer flexible spaces to regular office spaces today, with a strong emphasis on workspace flexibility for employees," the report added.
ANAROCK found that the western markets of Mumbai Metropolitan Region (MMR) and Pune saw net absorption of approximately 1.48 msf office space in Q1 of 2023. Of this, 24 percent or 0.35 msf was by co-working players.
In the NCR, 32 percent of approximately 1.89 msf office space was absorbed by co-working players.
Kolkata saw a mere 0.25 msf of office space absorbed in Q12023, of which 12 percent was by co-working players.
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 co-working setups in areas such as Gurugram and Noida," said Utkarsh Kawatra, Senior Director, ANAROCK Group.
"In MMR, corporates looking to expand aggressively and shift their operational divisions to smaller distributed locations are focusing on co-working spaces," the report said.
The report added that, going forward, the expansion plans of major players and the increasing appetite for this format from occupiers, property owners, and co-working operators will fuel further growth.
Kawatra said that the perception of offices has changed during the pandemic. The workplace is now perceived as an environment that must be optimally managed.
“This necessitates an element of specialisation, in which the flexible space operators fill the niche as specialist workplace management firms. We are increasingly seeing the desire to cultivate an environment of collaborative enterprise that yields tangible benefits to the occupier, both in terms of cost and layout," he added.
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