Colliers International India, a global real estate services and investment management company, expects flexible workspace operators to slow down their expansion over the next six months. This follows the Covid-19-led lockdown and expectations around social distancing norms.

“We believe flexible workspace operators will slow their expansion over the next six months,” said Arpit Mehrotra, Managing Director, Office Services, South India, at Colliers International India.

“The reason for the slowdown is that Covid-19 has shown up new trends such as the integration of home as a place of work and the growing importance of the digital experience,” he added.

Sharing the flexible workspace offtake in Bengaluru, Mehrotra said, “In 2019, flexible workspace operators leased about 2.2 million square feet, accounting for around 15 per cent of the gross office space take-up across the city. In Q1 2020, flexible workspace operators accounted for about 11 per cent of the gross take-up, that is, about 0.4 million square feet of space in Bengaluru.”

He further said, “We foresee some consolidation of operators taking place at the entity level. Operators which invest in workplace hygiene and sanitation as well as social distancing measures should see greater enquiries from small and medium enterprises, since flexible workspace could reduce occupiers’ upfront capital expenditure.”

In the Delhi-NCR region, Colliers International India data showed that in Q1 2020, flexible workspace operators accounted for 19 per cent of the gross take-up in Delhi-NCR with approximately 3.4 lakh square feet, while the overall office market demand began to slow in Q2 due to India’s Covid-19 lockdown.

Amit Oberoi, Executive Director, Corporate Solutions, at Colliers International, said, “In the long term, the fundamentals for the office market remain strong and demand is likely to be driven by IT-BPM (business process management) and consulting occupiers. Flexible workspaces will be key beneficiaries as clients look at flexible office options in an uncertain business environment.”

He added, “We saw strong demand from flexible operators for space in 2019, accounting for nearly 18 per cent of the gross take-up in the market. Noida accounted for 48 per cent of flexible workspace operators’ take-up, followed by Gurgaon (38 per cent), while the remainder was in Delhi.”

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