Demand For Co-working Space Remains Strong Despite WeWork Episode: Report
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First co-working space in India was setup in 2013 (91Springboard). Today, over 250 co-working spaces are operational in the country, taking up over 8 million sq ft office area, shows the July-December 2019 report ‘India Real Estate’ by Knight Frank. The 12th edition of the half yearly report gives analysis of residential and office markets of top eight cities—Ahmedabad, Bengaluru, Chennai, Hyderabad, Kolkata, Mumbai, Delhi-NCR, Pune—in the country.
The space bought for building co-working businesses has quadrupled since 2017, with its share in the office space transacted volume increasing from 5 per cent in 2017 to 13 per cent in 2019. To put this in perspective, the entire manufacturing sector accounted for 12 per cent of the total area transacted in eight cities in 2019, as per the report.
The report shows that the overall office market did well, recording historic best year in terms of transaction volumes in 2019, whereas residential sector remained sluggish this time also.
Also Read: How to Start a Co-working Space
Office Market Records 27% YoY Growth
New completions in the office space market grew by 56 per cent in the last one year, delivering close to 61.3 million sq ft by 2019. Transaction volume witnessed a healthy growth of 27 per cent.
Of the eight cities, Bengaluru saw highest volume of new office space completed at 16.1 mn sq ft, followed by Delhi-NCR at 12.3 mn sq ft. In terms of transaction volume too Bengaluru dominated.
Residential Sales Rise by Meager 1%
Sales of residential units remained flat at 1 per cent in the last one year, with a total of 245,861 units sold in 2019 over 242,328 in 2018. But, new residential launches rose by 23 per cent Y-o-Y across the eight cities. Mumbai saw the highest number of homes launched in 2019 at 79,810 units, followed by Pune at 44,660 units.
“This stabilisation in volumes can be attributed largely to the fact that developers have been focussing on affordable housing and on lower ticket sizes. 60% of launches during H2 2019 have occurred in ticket sizes under INR 5 mn and 82% under INR 10 mn. 48% of the sales as well were concentrated in the under INR 5 mn ticket size,” said the report.