Co-working is a new trend that is going viral. This phenomenon is not only restricted to the millennial's but among conventional occupiers as well. Post-2005, the world recognized the cost-effectiveness of the coworking segment. However, India started reaping benefits of co-working recently. The demand for shared spaces is increasing at a rapid pace as it offers the flexibility to scale up operations without taking away the organization's focus from core activities. All round service, competitive rates, and vibrant work atmosphere are some of the key factors fueling the demand of co-working spaces in India.
The national operators like AWFIS, Smartworks, Apeejay, and Spaces are rapidly expanding their footprint by adding multiple centres in Kolkata in different micromarkets. Local operators like MBC and Easydafter are doing robust business too. Presently, there are about 8,500 seats on offer, which are running at an occupancy level of 80% to 95%. Another 1500 seats approx. are scheduled to be added over the next few months. The average cost of occupancy is about 30% to 35% lesser than traditional office space costs. Initially, it served the need of an organization, with limited manpower requirement in a specific geographical location to reduce cost on the overall rentals and enjoy amenities of fully-serviced office space. However, co-working has become a viable option for larger companies and promotes collaboration and flexibility.
The requirement of shared spaces is similar to traditional office space. The real difference comes in terms and form of the agreement. The novelty of co-working space is that they allow for innovation and let different people with unique skills and talents to connect and collaborate. This segment is more likely to expand faster in India due to the population growth where around 600 million people are under the age of 35. The concept of co-working spaces is mostly bounded to tier I cities as of now. However, operators believe that Tier II cities like Ahmedabad, Kochi, Chandigarh, Bhubaneswar, etc. do have ample potential and are actively exploring such markets for expansion. The segment is here to stay and will get bigger with time.