By virtue of being the fastest growing economy in the world, India has been an investor favourite since over the last 10 years. According to Invest India, an Investment Promotion Facilitation Agency, the total Foreign Direct Investment (FDI) inflows from April 2014 to September 2023 is $615.73 billion which is about 65% of the total FDI inflows in the last 23 years. This investment coming from various technology and BFSI companies in the country is creating immense demand for Grade A commercial office spaces in the top 7 cities namely Mumbai, Bengaluru, New Delhi, Hyderabad, Pune, Ahmedabad and Kolkata.
However, it’s pertinent to ensure optimum utilisation of per square footage of area as land is increasingly becoming scarce in central and secondary business districts. Several reports indicate low efficiency in space utilisation and this inability to optimise space utilisation results in extra maintenance and utility costs, property taxes, and limits ability to raise revenues from allied activities. This leads to bad occupier experience and strains the building infrastructure. This phenomenon holds true particularly for large commercial office spaces where they are either assigned to businesses with big teams or when the space is poorly readjusted for the new purpose.
Most often, limited space stems from poor space allocation when the environment doesn’t match the work process standards and employee needs, leading to high operational bills and low productivity. Therefore, concepts such as open-space designs and space planning become crucial to implement in order to enhance productivity per square footage. Open space designs entail dividing the space into multiple zones and allotting spaces to different teams accordingly to meet their varied requirements while ensuring optimum utilisation of per square foot.
Other solutions involve multifunctional spaces which calls for designs that serve multiple purposes such as a meeting room which could double as a presentation or lounge space, ensuring efficient traffic flow to avoid to avoid congestion and improve accessibility and outdoor integration in the form of rooftop gardens, or patios that serve as extensions of indoor spaces for recreation purposes.
In addition to the above, having a future-proof design also means accommodating evolving technologies and trends to meet the nuanced requirements of occupiers. A flexible design structure of a commercial space allows developers to seamlessly incorporate design strategies that allow for easy adaptation and integration of new technologies. This means an easy upgrade to new technologies such as Smart Automation, Internet of Things (IoT) to offer a seamless experience in accessing services at office spaces. Lastly, sustainable design practices and biophilic design, which integrates natural elements into the development of the project, are integral to optimising space efficiency while meeting the finer requirements of today’s occupiers who are increasingly committing to providing a healthier workspace and reducing carbon emission from operations. These factors become crucial to future proof the commercial real estate which is the backbone of the industry in India.
Here, co-working spaces are emerging as a prime example of democratising commercial office spaces by ensuring optimum utilisation of spaces while incorporating elements of technology and sustainability. According to property consultant Anarock Group, coworking spaces are gaining popularity among businesses in India, with demand doubling in the past four years. In Q1 2023, coworking spaces represented a 27% share of the net absorption of 8.2 million square feet across the top seven cities, a significant increase from 14% in Q1 2019. Among other factors, this is an outcome of better space utilisation allowing occupiers to accommodate larger teams while not compromising on the comfort of employees.
Over the next decade, efficient space utilisation will be a prime trend in real estate with the commercial segment leading from the front in bringing innovative practices. The sooner the industry adopts to these changing requirements, it will be better prepared to cater to the changing industry dynamics with the call for technology inclusion and sustainable spaces becoming louder with each passing year.