Issues aside, cost efficiency, networking opportunity make co-working work

Real estate experts say such places work out to be 15-25% cost efficient vis-a-vis permanent offices

WeWork came in first with its co-working space, and a trickle of local players followed. That has now turned into a deluge, with mainstream real estate players such as DLF Ltd, the Hiranandanis and the Embassy Group getting into this business. 

According to ANAROCK research, driven by the information technology companies and start-ups, the co-working space segment grew 23 per cent growth in the second quarter of this year over the preceding quarter. Bengaluru recorded the maximum leasing activity in the segment during the period, followed by Hyderabad, Chennai, the national capital region and the Mumbai Metropolitan Region.

So why this rush for plug-and-play type work spaces? Anuj Puri, chairman, ANAROCK Property Consultants, says besides saving on a company’s infrastructure cost, these spaces offer the benefit of accessibility to teams. On the supply side, there are more than 200 co-working players — both branded and non-branded — operating across the country.    

For many companies, it is not just the ease of operation that a co-working space offers. The immense networking opportunities hold the key. Marcel Hoover, founder at Openjamm, which operates out of WeWork, says from a business perspective, a co-working space has given the company an opportunity to host a lot of gigs in-house at varied locations and get direct feedback from the audience. “The culture keeps us motivated and we feel connected to the space. The community team regularly organises events such as workshops, panel discussions and other events that are useful for startups like ours,” he adds. 

According to industry experts, such spaces are great for freelancers and women employees seeking flexibility and for those looking to be stationed at prime locations with easy connectivity and faster commute options. “Awfis is well-known for its affordability along with a thriving culture. It aids ample networking opportunities with other members of the,” Samiksha Ghadigaonkar, founder & director, Ngage Media Services.

Some others love the idea of being away from drab offices. “The OYO Workspaces team regularly organises engaging events, which are real stress busters and we get to learn new things. I learned to play the guitar, which has been on my mind for a long time,” says Marlyn Sequeira of VistaPrint.

The Ritesh Agarwal-led Workspaces is set to open the doors to its 21 plus co-working workspaces, with 15,000 seats across 10 cities in India. It hosts over 6,000 employees from brands including Swiggy, Paytm, Pepsi, Nykaa, OLX, Lenskart, among others.

Together we can

Top co-working leases in 2019

• WeWork leased 250,000 sq. ft. space at Vaishnavi Signature in Bengaluru
• Skootr leased 22,000 sq. ft. office space at DLF Square in Gurugram
• GoHive leased 50,000 sq. ft space in Udyog Vihar in Gurugram
• Hong Kong-based Garage Society leased nearly 19,000 sq. ft. space at Cybercity in Gurugram
• Delhi-based Smartworks signed 8 lease agreements equalling approx. 800,000 sq. ft. across Bengaluru, Chennai, Pune and Noida in the first half of 2019

Sources: ANAROCK Property Consultants

The cost benefit also plays a key role. Real estate experts say such places work out to be 15-25 per cent cost efficient vis-a-vis permanent offices. They cut down rental costs, fixed capital investments and property maintenance costs. “WeWork has turned out to be cost-effective, flexible and has helped me meet some amazing people,” said Rohaan Aditya Dang, founder Artifold.

But co-working spaces do have some shortcomings. Companies might save on their overall costs but co-working can expose an organisation to several risks. “For companies dealing with high volumes of confidential data, sharing spaces can be potentially challenging. Cyber security is a major strategic challenge for organisations today and efficient co-working spaces need to help mitigate these concerns,” Puri adds.

He says co-working spaces must move away from the current lease-based model to a revenue-share one, developed in partnership with the land-owner, developer and even the space-provider to minimise risks for the entire ecosystem.