Chennai has evolved as a predominantly IT/ITes destination with majority of the work involving handling of sensitive third party or captive data. Also owing to the fact that the volume of the outsourcing work is immense, IT/ITes companies have appointed scores of employees that compel them to occupy vast swathes of real estate. This innate compulsion has till now been the demand driver for office space for lease in Chennai.
One of the major innovations in the global real estate sphere has been the rise of the co-working concept. In fact the emergence has been so meteoric, that international players WeWork, as per media reports, has emerged as the single largest space occupier in Manhattan displacing centuries banking giant JP Morgan from its perch as the leading occupier. This is nothing short of revolutionary, as the quantum of space occupancy in the American micro-market has long been the gold standard for symbolizing the economic might of a company.
However, the co-working juggernaut that has been rapidly growing in stature on the back of the booming start up culture pervading through the country, has started knocking on the doors of Chennai. With major domestic and international players spreading their tentacles in the major metros of Delhi, Mumbai and Bangalore, attention is gradually shifting to other urban centres such as Chennai, Hyderabad and Pune. What is also interesting to note is that a couple of the major players in this sunshine sector are promoted by reputed real estate developers based in South India. Therefore, an expansive push into already well-versed markets is all but natural.
The latest metamorphosis of this model can provided a novel avenue for growth for developers active in the market for office space for lease in Chennai. In the other markets where they have a strong presence, co-working companies have tweaked their business model to cater to IT/ITes companies, especially firms that want to start small, or have temporary space requirements. They have evolved a sort of real estate outsourcing model, where the co-working brand takes the space on lease and fits it out in return for pre- commitment of a certain number of seats or the whole facility, by occupiers. The daily operations of the facility are managed by the space operator. Hence, in combination, this model enables the occupying entity cost rationalizations in both capital and operating expenses.
Large campuses such as DLF Cybercity, Chennai present a fantastic playground for such concepts to advance. With vast open spaces and world class leisure facilities on offer within the self-sustaining development, co-working concepts can look at cost rationalizations of their own. One of the reasons for co-working concepts to rise in popularity is the informal, edgy and “cool” environment they provide by way of design of their work areas. This is supplemented by amenities that include a break -out area, F&B zones etc. However, within developments like Cybercity, because facilities are already in abundance, co-working operators can look to save space for services and build larger work areas, thus attracting larger tenants and improving bottom line.
Greenfield sectors such as co-working are providing fresh opportunities for growth and market expansion. With such new models of real estate evolving, these are indeed exciting times for real estate in Chennai. Further information on DLF IT Park Chennai address OR DLF Office Spaces in Chennai can be accessed at http://www.dlfcybercity.com/chennai/