The co-working economy is taking the world by storm. We take a look at why co-working seems to have a universal appeal.
Across the world, co-working spaces (or shared office space) are on the rise, with freelancers, startups and small and medium businesses flocking to for their amenities, prices, and flexibility and networking opportunities.
While the concept of co-working isn’t new, the buzz around it and the incredible growth it has seen the world over reflects a transformation in what people want out of their workplace.
As people lead increasingly isolated lives thanks to more people opting for nuclear families and the disproportionate amount of time we spend on our smartphones, inspiring spaces where people can connect, collaborate and be productive are the need of the hour. Rapid urbanization, increased traffic and travel times also mean that the demand for cost-effective workspaces close to home has risen.
Co-working is revolutionizing the way we work and has in recent years taken India by storm.
While the leasing of shared spaces is approximately 1.5 mnsqft across the country this year, a recent CBRE report predicted that leases are estimated to touch ten mnsqft by 2020.
Another study by JLL estimates that the market size for India’s co-working segment is approximately in the range of 12-16 million, of which 5 million will be concentrated in Delhi NCR, Mumbai, Bengaluru, Chennai, Hyderabad and Pune.
Additionally, India’s co-working market is expected to receive as much as $400mn in funding by 2018.
The co-working model is simple – office spaces are rented out to individuals or teams, based on desks usage and time spent. Co-working spaces provide both flexible desk options (like hot-desking, dedicated desks and customizable team rooms) as well as flexible time options (hourly, daily, or monthly packages) to choose from.
Basic amenities such as workstations, high-speed wifi, coffee, and meeting room usage are provided and range from Rs 3000 to Rs 10,000 per desk per month, based on the convenience of location and the amenities provided.
Garima Juneja, Founder of Coworking India Magazine, which launched last year as a response to the booming growth of the segment, shares, “The cost and convenience factors play a big role. You get to pay less and worry less about maintaining an office. The youth of today is no longer afraid of sharing their life with others. It lets you save money by sharing resources and also increases your chances of growing your business via the co-working community.”
Today, India has approximately 350 co-working space operators running over 800 co-working spaces.
While 85% of these spaces are in Tier 1 cities like Mumbai, Delhi and Bengaluru, the remaining 15% are based in Tier 2 cities.
Mr Amit Ramani, Founder and CEO of Awfis Space Solutions, believes there are several factors that make a co-working space successful.
“It is about enabling a good working experience for the professional of today by taking care of the location, convenience and flexibility. One of the other significant benefits of shared offices is cost saving. Companies can save between 10% to 25% in Tier 1 cities by choosing a shared space over a conventional office,” he shares.
Such is the excitement about India’s growing co-working market that global leader WeWork entered India earlier this year with a 1.4 lakh sqft space in Bengaluru and an impressive 1.9 lakh sqft space – that is, a 16-storey building – in Mumbai’s posh Bandra Kurla Complex.
Juggy Marwaha, India Lead of WeWork, shares his views in the JLL report on how he sees the co-working space developing.
Photo Courtesy: Ministry of New
“The trend is moving towards creating beautiful, well designed and functional spaces that encourage collaboration and create a sense of community. There will be a paradigm shift in the way companies will operate in the future, and some of the best innovations will be an outcome of such true community collaboration,” he says.
When we think about beautiful, well-designed collaborative spaces, we cannot miss out on mentioning South Mumbai’s uber chic Ministry of New, founded by Marlies Bloemendaal and Natascha Chadha, who were looking to create a ‘professional oasis’ away from the city’s chaos where new ideas could be nurtured.
A boutique, high-end co-working space with an international design vibe, Ministry of New hosts a broad cross-section of professionals working in industries ranging from crypto-currency and astronomy to crystal design and feature films and has created an eclectic and passionate community.
“Ministry of New was not started as a ‘desk rental space’ but as a community of like-minded creatives wanting to work on their own projects as well as share new ideas. This ethos still runs through our brand’s DNA. It’s what’s given us a genuine voice versus an empty real estate offer,” shares Chadha.
The affordability, flexibility and negligible capital expenditure make co-working spaces a natural choice for freelancers, startups and creative professionals.
However, in recent times, mid and large-sized corporates and traditional businesses have also started seeing the benefits of working out of spaces.
A recent survey said that there is a 71% boost in creativity and a 62% increase in work quality of people who use co-working spaces.
Coworking spaces seem to have a universal appeal – for consumers (corporates, startups, freelancers) the cost savings, flexible options, ‘cool’ vibe, and networking and growth potential make it an attractive option.
For providers (developers, investors), the pricing, flexibility, higher rates of occupancy, and usage of underutilized real estate make it a worthy proposition.
There is no doubt that the co-working segment is set for huge growth in the years to come. As we look around us, we see the concept of the shared economy seeping into almost every aspect of our lives.
Home sharing (Airbnb) and car sharing (Uber, Ola) are already big successes, but shared economy concepts and values are extending further through the food industry, pet industry, co-housing projects, and many others.
‘Collaborative consumption’ is not just a buzzword, but is also a lifestyle that the youth of today actively seek.
(Written by Namrata Tanna)