The coworking industry has witnessed remarkable growth over the past decade. Initially popular among freelancers, startups, and small businesses, coworking spaces are now increasingly being embraced by large corporates. As per a report, the demand for flex spaces has been significantly driven by technology occupiers in the top cities with top tech companies occupying 50% of total flex space in India. Additionally, sectors such as engineering and manufacturing and BFSI (banking, financial services, and insurance) are actively adopting hybrid working models through flex spaces. These companies have recognized the immense value that coworking spaces bring to their operations, particularly in terms of cost savings, flexibility, and access to premium amenities and services. As a result, many coworking providers have shifted their focus towards catering to the needs of larger corporate clients, offering custom-designed spaces and tailored services to meet their unique requirements.

Benefits of Coworking Spaces for Large Corporates

Large corporates are turning to coworking spaces for a myriad of reasons, and the benefits are significant. One of the primary advantages is cost-effectiveness. These spaces provide an opportunity to reduce overhead costs and avoid long-term commitments. Rather than investing in their own dedicated office spaces, large corporates can leverage the flexibility and scalability of coworking spaces. In lieu of having a single, enormous central headquarters, companies are now choosing a distributed workspace strategy to guarantee convenient commutes for their staff. They have the freedom to choose workspace options that can easily be adjusted as their business needs evolve, allowing them to adapt quickly to changing market dynamics.

Moreover, coworking spaces foster a culture of collaboration and networking. By sharing a workspace with other companies and professionals, large corporates can tap into a diverse network of talent and expertise. This encourages innovation, knowledge-sharing, and potential partnerships. The opportunities for cross-pollination of ideas and collaboration within coworking spaces can prove invaluable for large corporates striving to stay ahead in a rapidly evolving business landscape.

Access to premium amenities and services is another compelling reason for large corporates to embrace coworking spaces. These spaces often provide state-of-the-art facilities, modern infrastructure, and well-designed environments that inspire productivity and creativity. From meeting rooms equipped with advanced audio-visual technology to high-speed internet connections and 24/7 access, coworking spaces offer an elevated experience that large corporates can leverage without the burden of managing these resources in-house.

Challenges and considerations

While considering the adoption of coworking spaces, large corporates do face challenges and considerations. Privacy and security concerns naturally arise when sharing a workspace with other companies. However, coworking operators have been proactive in addressing these concerns. In addition to private office suites, coworking operators have implemented enhanced IT security measures. They recognize the importance of safeguarding corporate data and have invested in robust security systems and protocols.

This includes secure networks, encrypted data storage, and regular vulnerability assessments to identify and mitigate potential risks. By working closely with coworking operators, large corporates can strike a balance between the flexibility and collaborative benefits of coworking spaces and the privacy and security requirements of their business operations. These partnerships enable companies to enjoy the advantages of coworking while maintaining the necessary confidentiality and data protection standards.

Future Outlook

Looking ahead, the future of coworking spaces for large corporates looks promising. As per a report, flexible space stock in India is expected to cross 80 million sq. ft. by the end of 2025. As more and more companies recognize the advantages, the industry is poised for continued growth. Coworking operators are adapting their offerings to cater specifically to the needs of larger corporate clients.

Enhanced amenities, improved security measures, and customized workspace solutions are being developed to meet their unique requirements. In addition to better amenities, coworking spaces are also aligning with the growing demands of large corporates for sustainability and employee wellness. Green initiatives, such as energy-efficient lighting, recycling programs, and the use of eco-friendly materials, are being adopted to create environmentally friendly work environments. Furthermore, coworking spaces are incorporating wellness initiatives, such as fitness centers, meditation rooms, and healthy food options, to support the physical and mental well-being of employees.

In conclusion, the rise of coworking spaces has opened up new opportunities for large corporates to optimize their operations and achieve greater flexibility. The benefits of cost savings, scalability, collaboration, and access to premium amenities are proving irresistible to these companies. With the challenges of privacy and security being addressed, coworking spaces are poised to become an integral part of the corporate landscape. As the industry continues to evolve and innovate, we can expect more providers to specifically cater to the needs of large corporates, further enhancing the coworking experience.

This story appeared in the 13 June, 2023 issue of The Times of India and was originally published at: Why large corporates are turning to coworking spaces 

Chennai: Leading co-working space provider, Awfis, is aiming at doubling its revenue at 1,000 crore from the current 500 crore by July next year. It will have a leasing space of 10 million sq ft comprising more than one lakh seats spread over 200 centres in 19 cities by the end of FY23.

With firms tuned to the distribution network – decentralising their workspaces to multiple cities post-Covid – the demand in tier II cities is on the rise. Against this backdrop, India’s largest homegrown coworking space provider is attempting to push the revenue share from these locations to 10% through expansion. Currently, tier II cities account for 50% of Awfis presence in terms of cities, contributing 5-6% of the total revenue.

With firms tuned to the distribution network – decentralising their workspaces to multiple cities post-Covid – the demand in tier II cities is on the rise. Against this backdrop, India’s largest homegrown coworking space provider is attempting to push the revenue share from these locations to 10% through expansion. Currently, tier II cities account for 50% of Awfis presence in terms of cities, contributing 5-6% of the total revenue. “Pre-Covid, we were present only in two tier II cities including Bhubaneswar. After Covid, we are in nine tier-II cities including Jaipur, Chandigarh and Kochi. While we are soon going to open in Lucknow, Coimbatore is on the horizon in the next 12 months,” Amit Ramani founder & CEO, Awfis told TOI in an interview. Now, the firm has a capacity of 88,000 seats spread across seven million sq ft at 150 centres in 17 cities in different parts of the country.

The company recorded a revenue of 229.6 crore in FY20, which was 216 crore during the pandemic hit year of FY21. The revenue rose to 278.7 crore in the last fiscal of FY22. As of October 2022, Awfis reached the revenue of 500 crore and expects to close this financial year (FY23) at 600 crore. To reach the milestone of 1,000 crore, Awfis is focusing on enterprise business, expanding its network and innovative business models.

Ramani said, 40% of their business is from the enterprises and the remaining 60% is a mix of MSMEs and mid-sized corporates and startups. “Coworking is shifting into quick service real estate because somebody needs office space for a day, another company needs for five years and some company requires 1,000 seats. That’s where the model is moving,” he said. Noting that co-working spaces will continue to see a demand, he said, pharma, healthcare, health-tech, consulting and creative agencies were the sectors that are seeing a surge in demand for co-working spaces.

To a query on IPO, he said, the company will go public in another 12-14 months depending on the market conditions.

This story appeared in the 8 November, 2022 issue of Times of India and was originally published at: Awfis focuses on doubling revenue to 1,000 cr

The interplay between office landlords and developers, investors, operators, and occupiers is being altered by the emergence of proptech. Increased reliance on technology and data is producing an excellent employee experience.

There is an interesting trend worth mentioning within the commercial real estate (CRE) space. The COVID-induced pandemic that resulted in halting of construction activity across the country, couldn’t deter the industry stakeholders from building a capacity for technology adoption. Property technology (Proptech) adoption has only increased across the real estate sector. Much of the CRE, including shared workspaces, are witnessing the benefits of a proptech adoption.

What does adoption mean?

The CRE industry is ripe for disruption. In the fast-paced world, new technology solutions relating to data and proptech are constantly emerging while older systems are being updated or phased out. Technologies like virtual reality, the Internet of Things (IoT) and artificial intelligence are changing the way people work, live, and interact with properties. These technologies also present an opportunity to increase operational efficiency and optimize performance at all stages of asset life cycles from initial investment to final disposition.

To keep up with this pace of change, the innovation and adoption curve in the industry has accelerated significantly. From proof of concept to pilots and production implementations, there is a major acceleration of new technologies in the property sector.

As a result, there is a future in which buildings will be even more connected, sustainable, and intelligent. These changes will lead to new standards for occupiers and owners, as they adopt these technologies across their properties to create more productive workspaces. And emerging technologies tend to impact the relationship between the five pillars of CRE: developers, investors, operators, occupiers and employees. Here’s how:

Development of collaborative workspaces: Developers and flex operators continue to focus on the creation of more collaborative workspaces. Tech adoption will drive innovation in the way we design and use space, bringing new ways of collaboration and interaction between humans and technology. Hence, buildings will be more connected, with sensors enabling occupants to track energy use, see and control their building systems, and access real-time information.

Based on the use of proptech, one can divide workspace development into two phases: the construction phase and the design phase. New technologies such as 3D printing and building information modelling (BIM) have the ability to transform the construction industry, bringing more customized designs and new materials. BIM is revolutionizing the construction industry by enabling designers and engineers to collaborate digitally, using real data to design buildings. Stakeholders in India have started using BIM and are able to reduce the time and cost overruns across projects.

While designing, developers are trying to create the workspaces of the future; they focus on creating work environments that would be more flexible and fluid. These will also be secure for data and more collaborative for teams. Much of this trend is backed by the demand from millennials. Being a majority of the current workforce, the segment continues to drive new standards for collaboration and flexibility in their workplaces.

Creating a more productive workspace: The pace of proptech adoption in the CRE space has been fast in the last two years. AR and VR technologies are now enabling designers, engineers, and facility managers to collaborate remotely and in real-time, saving time and money.

Much of the space recalibration in the new normal has been done keeping in mind the new requirements. For example, the use of VR is allowing designers to immerse themselves in the design and also train employees prior to them arriving at the site, helping to make the office safer.

AR, on the other hand, is being used in real time, including overlaying information, helping to guide the design process, as well as providing information on the surrounding environment. An example of adoption would be the creation of a connected cloud kitchen and a canteen across offices.

The success of a workplace

We are in the midst of an evolution. The focus is on developing a centralised operation to manage and operate an office. This would save time and money and improve occupant experience. By controlling most of the functions to a central hub, building managers now view data in real time and identify issues before they become problems.

Building operators are also using data to better forecast energy demand, enabling them to manage their facilities more efficiently. This data is being used to create a more sustainable environment, helping to reduce waste and water usage and even manage the parking space. Sensors can also monitor indoor air quality, helping to identify issues such as CO2 levels or temperature in different sections of a premise.

In times to come, proptech will prove to be an effective tool that will help the wider community in tackling the challenges like urban mobility and pollution around workplaces. Keep an eye out for the transformation and enjoy!

This story appeared in the 30 September, 2022 issue of Times of India and was originally published at: Proptech is driving CRE transformation