Shared Office Spaces in India: An Emerging Market
Shared office spaces (also known as coworking spaces) are becoming popular in India. In the last 5 years, its massive growth has disrupted the traditional work environment. Reports say that 13 million people will work from coworking spaces by 2020.
Emerging Office Space Market in India and Entire Asia Pacific Region
Steady economic development and burgeoning startup community in India is driving the flexible workspace industry. In the Asia-Pacific (APAC) market, India has the 2nd largest flexible workspace market, second only to China. CBRE report has found out that in the last 4 years, US$3 billion has been infused in the shared office space market, making it one of the fastest growing emerging markets.
During first half of 2018, shared office space market reached a total footprint of around 40 million sq. ft. This expansion has mainly taken place in 16 major cities in the Asia Pacific region including Bengaluru, Delhi NCR, Mumbai and more. In India, co-working culture has mainly evolved in Mumbai, Delhi NCR, and Bengaluru.
Reports say flexible spaces available in these three cities are around 2.8, 2.9, and 4.1 million sq. ft. respectively. Therefore, co-working spaces available with respect to the total real estate inventory for those cities is around 2.83 percent.
The concept of shared office spaces is catching up in metros and other leading cities in India. While this market had doubled in 2017, the growth has been sustained in 2018. The co-working market is expected to continue its growth trajectory in 2019 too.
Top 3 Major Shared Office Market Trends in 2019
Here are the 3 most important trends that will shape the co-working market in 2019:
1. Large Companies will Start Adopting Agile Workspaces
Co-working spaces are most commonly associated with startups because of cost saving benefits. However, many large corporate entities such as Amazon and Starbucks are also adopting the shared office concept. They are utilizing this market not only to save cost but also to work with young, energetic and like-minded people outside the conventional office space. Coworking spaces are agile in nature, helping large companies to provide satisfaction to employees, increase productivity, and encourage innovation.
2. Traditional Companies will Embrace Co-working Culture
Every company wants to tap in the new-generation innovative minds and the best way to do that is embrace the co-working work space concept. Many traditional companies in the banking, insurance, and manufacturing sectors are trying to project themselves as new-age companies so that they can attract young talent.
3. Emergence of Niche Co-Working Spaces
Modern co-working spaces are equipped with Wi-Fi, snack bars, conference rooms, game zones, and many more. However, the existing shared market spaces are generic in nature, where people from all kinds of works and personalities can be found.
However, 2019 will witness emergence of co-working spaces that will be dedicated to people either doing specific type of work or having specialized kind of work. While there could be specified spaces for night owls or health aficionados. The activity-based users are around 41 percent now, which is expected to increase to 78 percent in the coming 2-years.
The emerging market of shared office spaces will witness significant levels of adoption and changes in the coming years. In 2019, India will experience an expansion of coworking spaces beyond metro cities. The next boom in the shared office space will come from the tier-II cities such as Ahmedabad, Chandigarh, Jaipur, Indore, Kochi, and others. CBRE expects the total area of co-working spaces to reach 6-10 million sq. ft. by 2020.