Co-working, the latest buzz in the landscape of changing workplace topography across India in the start-up space, is expected to see a quantum leap in real estate absorption over the next few years.
However, despite low co-work desk rates in Noida, talent pool and comparative low cost of operations, not too may co-working spaces is expected to be seen cropping up in Noida, vis-à-vis Gurgaon when it comes to the NCR region. One of the key reasons for this is the lack of a social life that attracts the kind of work-life demand a start-up culture demands. Lack of pubs and a low-fun quotient apparently fails to attract young talent pool to the city. In fact youngsters prefer going to a co work space in Delhi to operate than in Sector 62, which could be closer home.
In fact, despite the presence of a unicorn like Paytm which took advantage of Noida’s competitive low office rental rates for fast expansion, start-up pundits assess Noida may just have missed riding the big start-up wave because of certain lacks in its social culture. This will ultimately reflect in how the corporate real estate space will be able to take advantage of the trend towards the co-working in India.
Leasing in Noida so far accounts to 40,000sqft, which is only 3% of the total co-work leasing volume of the country. Gurgaon’s total co-working space absorption so far is 120,000sqft, which is 10% of the total co-working space volume of the country.
This despite the fact that Noida’ desk rates at co working spaces is much cheaper than that of Gurgaon and certainly much lower than other cities. While renting a desk at a Gurgaon co-work space may cost anything from Rs10,000-Rs15,000 per month, in Noida, they are available between Rs8000-Rs12,000pm. These are much cheaper in comparison to Mumbai co-work desk rates which cost around Rs15,000-Rs27,000 per month.
“We foresee that the concentration of co-working space will intensify further in Bengaluru, Mumbai, and Gurugram (Gurgaon) due to the availability of adequate infrastructure and opportunities for start-ups in those cities. Hyderabad may also pick up the pace as companies such as Apple, Google and Amazon, have recently taken large office spaces in the city which will create further opportunities for start-ups and a few SMEs. Among Tier II locations, cities that have a high presence of technology companies such as Pune, Jaipur, Chandigarh, Ahmedabad and Kochi should also witness the emergence of co-working hubs,” informs Surabhi Arora, Associate Director Research at Colliers International India.
Commenting on the lack in Noida of a city-environment conducive to a start-up culture, Arora says, “we have observed youngsters would rather go to Connaught Place than to Expressway to co-work. However, a deeper reach of the metro and easier connectivity in future may change the game for the city.”
However, start-up pundits feel that Noida may have lost the startup opportunity to Gurgaon early on and despite its infrastructure problem, Gurgaon has a winning edge over Noida for being able to attract the young workforce because of its fun quotient and pubs.
“Noida, despite its opportunity in talent and low cost of operations seems to have lost the start-up opportunity to Gurgaon when it comes to NCR region. This is primarily because Noida fails to provide a certain social life that young workforce look for. Attracting or retaining young talent is difficult in Noida,” Shailesh Vickram Singh, Executive Director, Seedfund Ventures, an early stage investing company, located in Noida’s Sector 16, said.
“Big international players are not keen on Noida just yet because of a lack in its entertainment scene. So clearly the co-working space growth for now is being seen in Gurgaon, Bangalore, Mumbai,” Surabhi Arora added.