By Manas Mehrotra, Founder, 315Work Avenue
The coworking industry has become more relevant than ever with the demand surging significantly in the recent times owing to numerous factors. Coworking spaces have emerged as the defining feature of India’s rapidly evolving commercial real estate market, reflecting the broader shift toward work culture, flexibility, collaboration, innovation, and sustainability. The demand has gained greater traction with corporates and MNCs continuing to make a beeline to coworking spaces that have emerged as strong centres of growth.
There continues to be huge traction for flex space from corporates of all sizes as flexible workspace has become a key component in the overall real estate portfolio of corporates to enhance employee productivity, foster collaboration, and optimising operational costs by scaling up or down as per business requirements. The coworking industry also continues to cater to diverse business needs with customized offerings, modern amenities, exclusivity, strategic location, robust technology integration amongst others while fostering a creative and dynamic work culture.
While major metro cities have been the key markets for coworking spaces, there’s a growing demand in tier-2 and tier-3 cities too, making the market more diverse. The rapid expansion of the coworking sector is backed by the consistent increase in inquiries, higher occupancy rates, and the evolving needs of modern professionals. These spaces have emerged as more than just shared offices and have evolved into hubs for entrepreneurship and innovation. As businesses increasingly shift offices from traditional and conventional set ups to coworking spaces, commercial real estate operators will increasingly lease space to flexible operators, and both will grow exponentially and co-exist in a win-win situation.
The coworking sector will also see consolidation, where larger operators may acquire smaller players to expand their footprint. Coworking businesses will also continue to attract investment due to the sector’s scalability and growth potential. While coworking spaces continued to perform well in the recent past, we believe the share of coworking in the overall leasing of flex space is set to grow further and play a pivotal role in 2025 and beyond.
As India’s workforce is becoming increasingly mobile, and coworking spaces are well-positioned to cater to this dynamic shift with niche offerings. The demand for coworking spaces is expected to grow at around 20 per cent over the next two to three years.