India’s Coworking Firms Turn To New Business Models
After a turbulent year for one of the biggest competitors in the coworking industry, WeWork, some analysts are wondering whether this will have an impact on India’s operators.
According to current competitors, growth in the sector will continue to be fueled by consolidation and a shift of ownership patterns.
Regardless of WeWork’s woes, the industry overall had a great 2019. For example, ChrysCapital invested $30 million in one of India’s biggest players Awfis, while real estate fund SmartOwner invested $4.28 million into Workspace.
A report from consulting firm Anarock also claimed that WeWork’s failures would not have an impact on India’s coworking market, and in fact, expects coworking offices to double or triple in the next two years.
Furthermore, it is expected that large companies like Google will start opting for flexible workspaces as demand and supply continue to grow. By the end of 2019, supply surpassed 12 million square feet.
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Another trend that has hit the industry are landlord partnerships where operators and landlords team up to share the risks and rewards of each coworking space. Focusing on revenue streams as well as SMEs and large enterprises has helped the industry become more sustainable.
“India is the second-largest market in the flexible workspace in the Asia-Pacific region after China with over 1,000 coworking spaces,” said Manish Khedia, Director of The Executive Center Bengaluru and Hyderabad. “In India, the industry is seeing 25% to 30% growth every year.”
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