With 27% rise in coworking rentals in four years, Mumbai leads as the top flexible workspace hub

• In Mumbai, the average monthly rental per flexi space seat rose to ₹15,900 as of FY 2024, compared to ₹12,500 per seat in FY 2020.
  
• Delhi's flex workspace rentals experienced an 18% rise, jumping from ₹10,000 per seat per month in FY 2020 to around ₹11,800 per seat per month in FY 2024.
  
• Despite the challenges posed by the pandemic, equity funds continued to flow into the coworking segment, shows MyHQ report
  

The flexible workspace dynamics have witnessed significant shifts ever since the pandemic. The sector, which once rose exponentially, received a disruptive blow due to the COVID-19-induced lockdowns as people hesitated to even step out, let alone share workspace with strangers.

However, the industry has bounced back strongly post-pandemic as many companies shifted to a more hybrid work structure. Accordingly, average monthly rental prices across India's top coworking cities have also seen drastic changes.

Mumbai, in particular, stands out with the highest rise, experiencing a 27% increase over the past four years, according to the latest report from MyHQ by ANAROCK property consultants.

Mumbai leads in rise in flexi space rentals

In Mumbai, the average monthly rental per flexi space seat soared to ₹ 15,900 as of FY 2024, compared to ₹12,500 per seat back in FY 2020. Similarly, Gurugram witnessed a substantial growth of 19%, with rental rates climbing from ₹8,500 per seat per month in FY 2020 to approximately ₹10,100 per seat per month in FY 2024.

Delhi's flex workspace rentals experienced an 18% rise, jumping from ₹10,000 per seat per month in FY 2020 to around ₹11,800 per seat per month in FY 2024. Bengaluru also saw a significant increase of 15%, with the average monthly rent for flexi spaces going up from ₹ 7,800 per seat per month in FY 2020 to ₹9,000 per seat per month in FY 2024.

Even in Noida, where growth was relatively moderate, there was still an uptick of 14% in average monthly rentals of flexi spaces over the last four years. Rental rates in Noida climbed from ₹6,500 per seat per month in FY 2020 to ₹7,400 per seat per month in FY 2024, indicating steady growth in the coworking sector across key Indian cities.

The report also highlights trends in the coworking segment observed during the calendar year 2023. Notably, some of the globe's most prominent corporations, including Google, Samsung, Rolls Royce Energy, Kotak Mahindra Bank, L&T, and others, are increasingly embracing flexible workspaces. This shift underscores a growing recognition of the benefits offered by coworking environments.

Co-working providers leverage technology to enhance workplace experiences

Furthermore, the report explains that coworking providers played a significant role in driving commercial real estate absorption in the top 7 cities. Major coworking brands such as WeWork, AWFIS, COWRKS, and Oyo Innov8 are leveraging technology solutions to enhance workplace experiences. These solutions encompass asset and inventory management, on-demand meeting room booking, parking automation, and intelligent visitors and access controls.

Says Utkarsh Kawatra, Senior Director, myHQ by ANAROCK, “The Asia-Pacific region has emerged as an important market for coworking spaces in the last few years, and demand is growing rapidly. Hong Kong, China, India, and Japan are among the large centres that are witnessing massive growth. India, being a hotbed for startups across various sectors and industries, is witnessing steady demand for flexible, economical workspaces.”

Data from the report reveals that coworking spaces accounted for nearly 18% of the total new office supply in the top 7 cities' office leasing markets during CY 2023. Moreover, the coworking sector has seen promising levels of funding, particularly in the post-COVID-19 era. Despite the challenges posed by the pandemic, equity funds continued to flow into this segment, indicating confidence in coworking's resilience and its potential for a strong rebound in the post-COVID-19 landscape.