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Brigade Group, a real estate developer, is to leverage its internal competencies to meet the demands for growing its co-working business – BuzzWorks.
“The group with in-house capability and capacity to handle things like the design and fit-out execution, facility management and F&B, we are able to achieve significant economies of scale,” Nirupa Shankar, Executive Director, Brigade Group, told BusinessLine .
The company operates its co-working business under the brand name – BuzzWorks. It currently operates in Bengaluru, Chennai and Kochi. “We currently operate at near 60 per cent occupancy for our current portfolio of 2,500 seats,” she said.
Also read: Brigade Enterprises posts ₹19.58-cr Q4 profit
Explaining the business model BuzzWorks is operating, Nirupa Shankar said, “Our model is more along the lines of managed offices rather than the typical ‘co-working’ model. What this means is that we get into long-term contracts with tenants who want us to execute the fit outs and take care of all administrative issues such as housekeeping, security, internet, tea, coffee, snacks and events for employees. We are willing to even take on the fit-out cost for tenants, if they are willing to sign on a slightly longer lease term with a mutually agreed upon lock-in term.”
Office space
Despite the Covid-19 second wave, demand for managed office spaces across various markets is on the rise. “Due to the lockdown, decision making is slowed. However, there are ongoing discussions in Bengaluru and Chennai for large requirements and we hope to close these transactions once the lockdown is lifted,” she said.
On the demand-supply front, Nirupa Shankar said “While work from home is something all of us have had to adapt to, it is not a long-term solution. We expect the market share of co-working spaces to steadily increase in the coming years.”
“FY20 saw 15 per cent of the overall office absorption space in flexible/managed offices. And while FY 21 has been a blip in the market in terms of both traditional office space and co-working space, it is likely that the market share of co-working will reach 20 per cent of overall office absorption in the next couple of years,” she added.
She further said “The advantage of co-working spaces is the flexibility they offer in terms of length of lease periods, lower outflow of Capex and other fixed costs and lesser hassles in terms of administration.”
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