Consolidation likely in co-working segment: Report

The report by 360 Realtors also said that the co-working ecosystem will continue to grow and evolve in the Tier-I cities backed by demand from both big as well as small enterprises. “It will witness more consolidation in the market space, alongside the entrance of new players,” said the report by the real estate consultancy firm, showing the recent example of Oyo’s acquisition of the co-working space provider, Innov8.

It observed that Delhi-NCR, Bengaluru and Mumbai would continue to be most favoured destinations for co-working spaces in the country and added that the segment will also witness steady growth in smaller cities such as Indore, Kochi, Ahmadabad, Surat and Nagpur. As per the report, millennials would play a major role in the growth of the co-working spaces in India. “It is estimated that over 40 per cent of the Indian workforce comprises of millennials. These millennials often want a more engaging workplace which can foster better networking and inspiration,” it said.

In the same way, the large number of start-ups in the country will also help the growth of co-working spaces. “Co-working space providers will also focus on better customer engagement, hospitality and value-added services,” it said. Regarding the global scenario, the report said that there are around 35,000 flexible workspaces around the world, and they are currently valued at around $26 billion. Until 2022, the market will grow at around 13 per cent annually.

“In 2018 alone, 2,200 new offices were built globally, out of which around 1,000 were opened in the USA. As per ‘Co-working Resources’ in London, every 5 days, a new co-working space opens. Likewise, in New York, space is opened in every 7.5 days. Other major cities around the globe, where the co-working industry is thriving at an unprecedented pace include Los Angeles, Singapore, Manchester, Barcelona, Lisbon, Bengaluru, Paris, etc. and not to forget, Ho Chi Minh, Jakarta, Gurgaon, Mumbai and Kula Lumpur,” the report further said.

Globally, 14 per cent of employees of larger enterprises are using co-working spaces. It is estimated that in future, 40 per cent of the demand for shared office workstations will emanate from larger enterprises, it added.