With the Covid-19 situation in Bengaluru, like several other parts in the country, worsening, many companies in the city are again opting for work-from-home option.
As the practice of work-from-home has its own pros and cons, Bengaluru-based companies have varied views regarding the productivity and office absorption in the new normal.
Darshan Govindaraju, Director of Vaishnavi Group feels that although the pandemic has adversely impacted many businesses, some of the sectors witnessed major growth around the same time.
“Covid and its continuous impact since early last year has undoubtedly forced businesses across all industries to adapt. The absorption of office spaces today is lower when compared to pre-Covid numbers for a few sectors. Having said that, some sectors such as healthcare, cloud computing, video conferencing, digital content or home entertainment, online educational platforms, payment gateways or any such companies building the digital infrastructure have seen phenomenal growth this past year. Growth in some sectors coupled with de-densification, which has now become a standard Covid safety protocol, we are noticing steady absorption,” he said.
“Today an occupant is looking at more than just the rental costs. An occupant is keen on safe, well ventilated and Grade A buildings with a reputed builder. Given that most developers have slowed down infusing new supply in the market and given the occupants preference, rentals/ leasing of good quality developers has remained the same,” he added.
When asked about if work-from-home has any impact on the overall productivity, Govindaraju said that companies that mostly rely on personal interactions, suffered a hit.
“Work from home has enabled a certain section of the workforce to work at the same efficiency levels as before. For individual contributors and smaller startup companies, the king’s effect has been marginal. However, for companies that need teamwork, collaboration and interpersonal skills such as sales, relationship management etc., it has been detrimental. Building new relationships with new colleagues or clients has been a challenge. Most companies today admit that wherever team effort is required, productivity levels are down substantially,” he said.
Errol Fernandes, Secretary of CREDAI Bengaluru, feels that the second wave of Covid-19 will result in a lot more work being outsourced to India, creating further demand for office space.
“While the absorption of smaller units from the mid-size software companies has stagnated, the absorption of large spaces by the Googles, Amazons and Microsofts of the world has actually increased. This is largely due to India becoming the digital capital of the world and the migration to the cloud is rapidly increasing, which is being facilitated by companies working out of India,” Fernandes said.
Fernandes further said that while the lease rates have remained stable for the mid-size office spaces, rent has increased by 5 per cent for the larger office spaces over the last one year.
Regarding productivity under work-from-home system, Fernandes feels that while productivity and efficiency has improved, it has its own side effects with people being cloistered together not just for hours but for days, weeks and months on end.
Prashanth Reddy, Managing Director of Fundermax India said that his company foresees at least 20 per cent drop in office absorption. He also feels that it is difficult to carry out certain activities from home.
“March ending quarter 2021, demand side and supply side is stable for office absorption. With the increase in Covid cases, we foresee at least 20% drop in office absorption. All the functions can’t be conducted from home as some functions require reporting to office to ensure smooth operation of the organisation. There are challenges like internet connectivity, privacy, online classes of children, etc. This set up is a temporary situation and offices are going to stay. By Q3, we expect at least 75% of the workforce to comeback to offices,” Reddy said.