Coworking space providers are offering companies a partial exit from their original tenant, then leasing remaining space to other clients.
“Coworking players are negotiating with the office space occupiers in a way that is beneficial to all stakeholders,” said Vibhor Jain, Senior Director and Co-Head, North India Markets, JLL. “They are able to successfully tweak the business model in a way that these negotiations benefit the market as a whole.”
For instance, if a company is looking to cut down on their office space without having to pay a hefty fee, coworking firms will come in and negotiate with the landlord and occupier to take over the company’s original space.
Gurgaon-based firm Skootr has already started using this model in places like Cyber City in order to support businesses that have faced major revenue and business loss over the past few months.
A Knight Frank study revealed that 3.2 million square feet of flexible office space is anticipated to be vacated this year, and companies have been persistent in negotiating for discounts on office spaces in wake of the pandemic.
“With this new model, they get the anchor tenant and have to look for a tenant for only 50% of the space,” said Mudassir Zaidi, executive director (north) of Knight Frank. “The office space operators, who are suffering because of the tenant exodus, are also agreeing to it as they get their rental.”