Converging The Co-Working Demand Supply
THERE IS A SCIENCE BEHIND THE ART OF CREATING CO-WORKING SPACES. SO WHAT ARE THE NEW AREAS OF DEMAND AND HOW THE SUPPLY DYNAMICS IS KEEPING PACE.
On one end is the urgent need to transform the sub-standard office space into quality workspaces, on the other a large portion of commercial real estate ownership is fragmented. According to Siddharth Dhawan, Director, Agile Real Estate Lead, Asia Pacific CBRE said, due to Covid 19 in past 6-9 months occupiers need has evolved around the purpose of the office. “It has been seen that productivity can be achieved from anywhere. On the demand side. now the question is that of new models of working and on supply side, how co-working operators will reconfigure the price of the product.”
Neetish Sarda, Founder, Smartworks said, “After the covid vaccine all sectors are witnessing 10-15% occupancy. By April there will be at least 50% occupancy and, by June 75% in office spaces.”
As per Rishi Das, Co-Founder & Chairman, IndiQube almost 60% people were still working away from offices. “IT and may other companies have adopted remote working. It totally depends on type of sector and their work culture.”
Vishwas Mudagal, CEO & Co-Founder, GoodWorks Coworking Spaces agreed that the very concept of office is getting redefined. “IT sector has learned to survive without office while, others have just 50% or less essential staff attending office. As many organizations are scaling down, co-working will be the obvious choice.”
Manas Mehrotra, Founder, 315 Work Avenue said, “Around 30-35% of entrepreneur are coming back to office in order to inspire teams to join back. Certain certification and courses have been provided to employees. Companies are providing perks to employees so that they will return to office.”
Kunal Walia, Founder & CEO, Simpliwork felt there was no need to worry about occupancy percentage. “Till now office real estate was dominated by IT companies, now collaborative work approach will be the demand driver for work spaces.”
Parthajeet Sarma, Workplace Strategist, Founder & Director, iDream agreed that nowadays the companies are taking decisions on the basis of certain benchmarks. “Employees want to join office to concentrate properly on work or for social and team building activities. Working from a Co-working space is now getting accepted in the hub and spoke model, as maintaining health, hygiene and safety at a traditional office complex is a difficult task.”
THE FUTURE LOOKS BRIGHT
With technological advancements, evolution in workstyle and demographic influences, office work in many cases is not tethered to a specific place. Kunal Walia said, “In addition to the factors pushing enterprise demand away from traditionally leased offices, converting fixed rental payments into variable costs, depending on employee strength is a key pull factor.”
Rishi Das concurred, “Commercial real estate will see certain proportion renting by traditional offices and certain in flex spaces. Companies will look at distributed offices within same cities or tier 2 cities.”
From a service provider perspective, Neetish Sarda said, we are looking at more integrated solution with a lot of amenities. The shared workspace market including serviced offices, co-working and flex spaces is in demand even in tier 2 cities.”
Pricing will play an important role in co-working sector. A lot of consolidation will happen with few operators shutting shop. Those with effective business model and fund will eventually survive.
Manas Mehrotra added, “In December 2020, we saw hundred seats requirements from certain companies. With time demand will increase in office space, it is for the providers to keep themselves ready to cater to large demand.”
Vishwas Mudagal brought another view point, “Companies are now emphasizing on design as they feel “cool” offices will make employees come to work.”
According to Parthajeet Sarma, the design follows function of spaces. ”Employees centricity is the focal point of co-working space design and thus the cool quotient. There is a science behind the art of interior design.”
Siddharth Dhawan concluded that post pandemic there has been a change in the way that office occupiers are looking at productivity of their employees, that could be at home or in a flexible space. “A large MNC from Singapore might want to have a co-working office space in other countries, Technology will be the biggest enabler of this segment.”
- Right partner approach is essential while selecting landlords.
- Taking up a commercial property on a long lease like 9 years works in favour of co-working operator only if it is sure of the location and the target market around.
- For a start-up occupier standard format works best while taking flexi space because their needs might change sooner than later.
- Relocating in a different city with the same service provider is more cost effective and a win-win for both.