COVID-19 not an end to coworking culture says industry

Bengaluru, May 3 (PTI) Reeling under pressure due to
sharp drop in footfalls following the COVID-19 pandemic,
operators in the country's coworking industry believe the blip
could be temporary and demand for flexible space would go up
again as some key factors are going for them.
But challenges remain for the sector, which has posted
remarkable growth in recent years and seen by many as a
catalyst of sorts for modern office spaces, as large
corporates are still wary of depending on them for their
expansion, citing restrictions and limitations.
With many employees working from home amid indications
that a significant section of them would continue to do so
even after the coronavirus-induced situation returns to
normalcy, coworking space providers would now have to rethink
their strategy, particularly in workplace, interior and design
areas, and make the segment more attractive for consumers.
While concerns around Covid-19 have also led to reduced
footfalls in co-workspaces which have been growing at a rapid
pace for the last few years, this blip could be temporary and
last till precautions are deemed necessary, said Manas
Mehrotra, Chairman of coworking company 315Work Avenue.
According to him, any businesses would now seize the
opportunity to rethink their working arrangements to provide
more flexibility to their employees than ever before,
especially considering the benefits of productivity and
engagement, and, this will push up the demand for coworking
spaces.
Once the lockdown period ends, companies would also lay
more emphasis on cost optimisation and prefer flexible
workspaces. Most corporates would avoid capital expenditures
and look to coworking facilities to expand their business,
Mehrotra said.
Ashutosh Limaye, Director & Head - Consulting, ANAROCK
Property Consultants, said coworking is likely to see subdued
demand over the next few quarters, but will also see the
fastest revival.
Once the pandemic pressures eventually ease out, several
businesses would look to restart in these flexible workspaces,
he added.
Coworking spaces are not only the most cost effective,
but also offer flexibility in terms of time period of rental
agreements. Coworking spaces can be rented on a monthly, day-
to-day and even hourly basis, Limaye noted.
According to Anuj Puri, Chairman ANAROCK Property
Consultants, on an average, coworking spaces offer a
substantial price difference of 15 per cent over traditional
spaces in the top cities.
While Pune offers the maximum cost advantage of 33 per
cent, Gurugram in the National Capital Region has the least at
six per cent, he said.
While start-ups and budding entrepreneurs make a beeline
to coworking spaces, large corporates remain wary of depending
on them for their expansion. This trend is quite contrary to
what is witnessed in developed European nations, Puri,
however, added.
Despite all the indubitable upsides of coworking spaces
largely patronised by enterprises, freelancers, small and
medium businesses and startups, they do have limitations and
restrictions, it was noted.
Apart from most of them lacking separate canteens or
pantries for occupiers, they also bar corporates from
organising events in common areas.
One of the industry players said maintenance of these
properties is another challenge. While some large companies do
use coworking spaces, these limitations have generally put
some others off the notion of embracing them despite the lower
rents.
Former Chief Financial Officer of IT major, Infosys Ltd, T
V Mohandas Pai told PTI: Co-working facilities have to
maintain social distancing, so they will take a hit because
density is very high, so I think there will be a problem.
A leading operator in the coworking space said social
distancing would now mandate the density in the open work
stations.
While the desk sizes have reduced, occupants would now
need to sit six feet apart. Newer air-conditioning systems
need to be installed to take care of air quality and prevent
airborne viruses and cross-contamination between offices
within a coworking setup, this player said.
Mehrotra said the coworking industry might also see some
consolidation soon and companies will explore acquisition
opportunities, adding, the current situation will also see
larger enterprises seeking smaller spaces to ensure synergised
business continuity in the near future.
The COVID-19 is certainly not an end to the coworking
culture as people would discover that the benefits of social
gatherings in terms of emotional and intellectual fulfillment
would be a crucial necessity for the overall health of a
society, he said.
People need options and access to a collaborative
environment is needed for success in life and work, he added.
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(This story has not been edited by THE WEEK and is auto-generated from PTI)