Tier II cities emerging as new hubs for shared offices

Kushal BhargavaUpdated: Saturday, March 12, 2022, 02:08 PM IST
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Renting out an entire office space is quite an expensive affair, /Representational image/ Work | Picjumbo

After permeating most metropolitan cities, co-working culture has found its way into major tier II and III cities of the country, and the trend suggests that it is spreading like wildfire, turning smaller cities into hub of shared-working spaces.

While there is a plethora of reasons as to why co-working culture is growing at such an exponential rate in small cities, the major reason is its cost-effectiveness.

Renting out an entire office space is quite an expensive affair, while one has to shell out a huge initial amount, there are a host of other expenses like scouting for a compliant office and then there are expenses for setting up the office. Whereas getting a shared-office space is far more easier because then one just has to lease-out a certain number of sitting spots in an already laced-up and set-up office space.

Its economic feasibility has made co-working quite popular not just amongst the start-up community but also with well-established Enterprise customers. In past couple of years, especially post the first wave of COVID-19, a lot of startups and small businesses have come into existence in various small cities of India that are actually based out these cities, and this certainly has laid an impact of the demand for shared office spaces.

Since business is growing in small cities the employers and MNCs are trying to set-up their offices in the smaller cities, because they have started the hybrid work module and setting-up small office for their employees who work from remote cities.

Demand from the small firms are also more because just at the start of their business they are often not much certain about the cash-flow, in such a situation, co-working spaces brings them a sigh of relief because it’s convenient and viable for the business owners in terms of money as well as efforts.

Citing this demand a lot of co-working space solution providers have started offering a package deal including a bouquet of services like IT infrastructural support, business grade internet, virtual address and on-demand provision of meeting/conference rooms, CCTV cameras, Cafeteria and parking space. So, the start-ups community and also young professionals are opting for shared-working spaces.

Another reason for this boom of co-working in small cities is the emergence of smart cities. As per government plan, several tier II cities are rapidly growing as smart cities bringing in prospect the growth of several businesses. As per a recent survey, a rise in demand for shared office spaces is noted from cities like Madurai, Raipur, Dehradun, Indore, Rajkot, Udaipur, Kota, Surat and Pune etc. The same survey also points out that around 250 co-working centres are present in more than 40 cities including numerous tiers II, III and even tier IV cities.

These factors like infrastructure budget constrain, flexible lease terms, easier accessibility in terms of ready tech-office infrastructure and office set-up are the driving force for the popularity of co-working in small cities. And, if the numbers continue to grow like now, small cities with soon become the new hub for co-working in India, they may even surpass the demand of co-working space in metropolitans.

(Kushal Bhargava is Co-Founder of MyBranch--office space solution provider)

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