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smartworks coworking space

Putting a Techy Foot Forward (Industry)

Smartworks

Smartworks has a presence in nine locations in both tier I and tier II cities. It looks at its prospects along with the demand for commercial leasing. Recently, it launched its first facility in Hyderabad, which is a growing business hub in India. Going forward, it is bullish about expanding in many other cities along with the ones it already has a presence in — Delhi-NCR, Mumbai, Bangalore, Chennai, Hyderabad, Pune and Kolkata. More than 90 percent of its clientele consists of enterprises. Some of the large corporates that workout of its centers are Tata Communications, Microsoft, Arcelor Mittal, Amazon, Carrier, Otis, Daikin, Lenovo, Bacardi, and OLX. They conduct various activities to ensure high community engagement within its facilities, including in-house F&B services, live bands, Djembe classes etc. It has launched Smart Weekends to boost employee productivity.The bootstrapped venture has already reached operational break-even at all its centers.

(RE)DEFINING THE CUBICLE
Specialty

Deployed ‘Made in India’ robot ‘Mitra’ at our offices. The humanoid streamlines the visitor management system at Smartworks.

Annual member fees

Rs 11,000 per member per month and Rs 1.34 lac per an annum

Amenities

Complete office management which includes IT support, infrastructure, community engagement, cafeteria, skill building activities to name a few

No. of locations and cities

22 locations across 9 cities

Occupancy rate

An average occupancy rate of 85 percent

Operational Since

April 2016

Total area 2.5 million sq ft

Bengaluru offices get smarter, thanks to digitised function (Industry)

Bengaluru offices get smarter, thanks to digitised functions

Employees no longer have to crane their necks to look at presentation screens. In smart offices, these are moveable and interactive.

Express News Service

BENGALURU: It’s a harried Monday morning and you scramble to your desk to take stock of the week that was. Amid the chaos, one of the things that remains steadfast in catering to your needs is the air conditioner, which regulates the temperature just the way you like it.

Welcome to the IT capital where workplaces are getting smarter, with firms converting conventional offices into state-of-the-art premises. From scheduling meetings in conference rooms to managing visitor timings, many office functions are getting digitalised. Companies are using facial recognition sensors, as well as mundane equipment like air conditioners and lights to understand each employee’s preference. The data is saved in the system and automatically retrieved for use the next time. For instance, when your clients visit for the first time, their names and details are recorded and sent to the concerned desk through a mobile app. The next time they visit, the data will be displayed automatically.

Employees no longer have to crane their necks to look at presentation screens. In smart offices, these are moveable and interactive. Firms also use apps to notify workers about upcoming meetings. Ramesh Nagaraj (name changed), who works at Smartworks, said, “We suffer traffic jams daily. But when I reach office, I feel refreshed because the environment is comfortable.”

“From regulating office temperatures to enabling team collaborations across locations, workplace technology is way more than just data today,” Jaiprakash Aildasani, regional MD, India, Space Matrix, a multinational workplace design consultancy firm, said, adding that statistics indicate that in a few years, the market size of smart workplaces will stand at $43 billion.

“With improving quality of life, industrialisation and fast-growing awareness about the advantages of Building Automation & Control Systems, the smart building market is projected to be a growing market with huge potential in Bengaluru,” said Gaurav Burman, VP and APAC Head, 75F, a building automation system provider.

An example is evident at Smartworks office in Outer Ring Road. Energy savings, enhanced operational efficiency and improved occupant comforts are some benefits, according to Harsh Binani, co-founder of the a co-working space provider. “We enjoy oxygen replenishment and removal of irritants like odours and dust,” he added.

Smartworks plans to increase footprint to 4 million sq ft by end of year

The company hopes to raise investment worth $30 million for expansion. Going forward, 10 to 15 percent of its new supply would be located in malls, warehouses and institutions

Q. What is the total footprint of the company and any plans for expansion?

A. We are a three-year-old co-working player based out of Gurugram and have now expanded to nine cities. We are present in Delhi, Gurugram, Noida, Mumbai, Pune, Hyderabad, Chennai, Bengaluru and Kolkata and essentially cover close to 2.5 million sq ft across these geographies. SmartWorks is an office experience company which is into managing office spaces. We take up individual buildings that are about 300,000 sq ft and focus on the common areas first – meeting rooms, conference rooms, and all common facilities one may require in an office space such as gyms, crèches and even sports facilities such as cricket, badminton, basketball. Most co-working players cater to start-ups, SMEs, companies looking for 10-20 seats for short term requirements. We do not cater to that demand. We cater to enterprise clients and work towards getting them to move their headquarters into serviced office spaces. Out of 300 clients, almost 95 percent are enterprises.

The average space take-up by each of our clients is about 280 seats spread across about 10,000 sq ft.

Also, most corporate houses are unable to replicate the campus-like experience in the regional facilities. We try and create a campus environment with multiple tenants and give them a custom-made experience for their offices. We focus on long-term deals spanning for almost three years.

In Delhi-NCR, we cover approximately 350,000 sq ft to 400,000 sq ft and are looking at doubling that number by the end of the year. Our current footprint stands at about 2.5 million sq ft and we plan taking it up to 4 million sq ft by the end of this year. The business has already seen an investment of close to about $25 million so far, all self- funded by promoters. We are in the midst of fund raising right now. For us to get to 18 million sq ft within five years, there will have to be significant amount of investment. At this point of time, we are looking at raising close to about 30 million dollars.

Q. Any new trends for 2019?

A. One of the trend that is picking up is to do with mixed-use facilities coming into co-working. We have looked at malls that are strategically located but not doing well. We are seeing that kind of supply coming in as co-working spaces in areas such as Pune and Mumbai. Such inventories are expected to change the industry. There is also going to be consolidation in the co-working segment in the next eight months. There are 400 players today but only five to six players today who command 80 per cent of the market.

We have not looked into stadiums yet but are open to it. We have converted a warehouse in Chennai into a co-working space and received a commercial license for the warehouse. Going forward, 10 to 15 percent of our new supply would be in other varied asset classes such as malls, warehouses, or even institutions that are in the right location.

Q. Is co-working segment expected to get a fillip with the introduction of REITs in the country?

A. REITS are a healthy exit option for co-working spaces as well. Essentially when we started out we were looking at strategic acquisitions. It is definitely a path going forward. REITs is still very young in India. There need to be a couple of other REITs first before co-working can be shown as an option but it can be looked at in the next two to three years.

Q. What are the cost savings for companies opting for co-working spaces?

A. Nowadays, businesses need to either scale up very quickly or scale down rapidly. For this they require flexibility. Gone are the days when you needed six to 10 years to scale up and grow at a certain pace. Today, companies with 100 people can go up to 1000 in a matter of months and go back to a 100 people in a matter of months. You require a flexibility where real estate is no longer a cost head, it is not a fixed cost but may be a variable cost. I think a lot more companies have started adopting real estate as an operating cost rather than an investment. The other saving is in terms of scale. Since you are sharing certain parts of the office that you are not using on a regular basis, you are able to derive better efficiencies from real estate. The cost savings are almost 30- 50 percent.

Q. What are the company’s plans for tier-2 towns?

A. As we look at touching 18 million sq ft, around 17 million sq ft is going to be in nine cities where we already have a presence. Only 1 million sq ft would be located in tier-2 cities. We are tracking Surat, Ahmedabad, Chandigarh, Jaipur, Bhubaneswar, Coimbatore and Madurai to start with. We would be present in these cities by the end of the year but this will only be about 4-5 percent of our inventory.

Consolidation brewing in India’s co-working market

India’s co-working industry is growing at a break-neck pace with not just start-ups but also enterprises adopting flexible working. According to some accounts, there are over 300 co-working operators in the country. Real estate advisory company CBRE states that India’s overall stock of flexible space increased by about 50 per cent, from 10 million sq. ft. in 2017 to about 15 million sq. ft. by the third quarter of 2018. The take-up increased 277 per cent to about 2.9 million sq. ft in the first quarter of 2019, over the year-ago period.Against the trend:

is consolidation brewing – the market, certainly, cannot accommodate 300 operators.

Business Today recently spoke to Harsh Binani, Co-founder, of Smartworks. He says that the long tail will not be sustainable. However, few of the larger players will continue to grow aggressively and garner more market share. Smartworks started three years back and has been able to scale-up. The co-working company manages 22 centres totalling about two million sq ft. currently. It has plans to grow ten times this number.

Other prominent players in this space include multinational WeWork and developer RMZ Corp’s CoWrks. Both these companies are expanding aggressively – a recent report in the newspaper, Mint stated that CoWrks was looking to raise $350 million equity to fund domestic and foreign expansion.

Here’s what Binani had to say about the co-working market and why Smartworks has been able to scale-up.

  • Consolidation:There is little entry barrier to the co-working industry – anyone with a basement can start a business. However, scale matters in this business – it brings in economies, and thereby, profitability. “There will definitely be consolidation opportunities,” Binani said. “Players of scale will be very limited. Players of scale will likely be the ones who will attract attention from the ecosystem, both customers and investors.”
  • Against the trend:Smartworks, in quick time, on-boarded many enterprise customers. This is the company’s focus – enterprise customers, not start-ups. The operator also prefers leasing out large spaces. “While a typical co-working space in India is 30,000 sq ft and the typical tenure is about 11 months, Smartworks has gone against the market trend. We don’t lease properties less than 150,000 sq ft. Our tenure is 2.5-3 years. That gives me a lot more stability in cash flow,” Binani said.
  • Profitability:Binani said Smartworks has been profitable for the last few months. The focus on enterprise customers is one reason. The company has also been able to cut down on wastage. “We are able to get a lot of efficiency out of un-utilised spaces, both in the common areas and in client areas. Our buildings have lesser clients – because one enterprise takes up a large space. On average, we have 250-280 seats. The more I sell, the more efficiency I can get. If I sell 20-30 seats, there is a lot of wastage that happens in between,” the Co-founder stated.

He added that the company has been able to manage lower input costs. “The capital expenditure on fit outs and the operational expenditure on running the centre both are critical in determining the selling cost of seats. We have optimised these expense heads. We use standardised brands in fit-outs – like Daikin for air conditioners – but because of our large scale, we can directly deal with manufacturers. We have been able to cut down the price of fit outs to a great extent,” he said.

Working hand in hand: How the growth of gig economy spurs demand for co-working space

Nyra Damani, 24, a freelance photographer, chooses to work independently, on her own terms. Life is often a struggle when projects are tough to find and clients don’t pay up on time but she wouldn’t trade her professional freedom to become a corporate slave despite the enticing comforts of a fixed monthly income.

Vivek Dogra, 35, a video editor, is a risk averse individual who on the other hand, loved his fixed monthly income from a news network, so he could organise his finances, pay his home loan EMIs, invest in his mutual fund SIPs and enjoy an international vacation every year. That was until he recently lost his job owing to restructuring within the company that had employed him for the last 7 years. As a result, he was tossed into the tumultuous freelancing world much against his will.

Fate brought Damani and Dogra together. Or rather, a co-working space in Gurugram did. No, this is not their love story but the results of this serendipity are no less interesting. Adjacent chairs in a co-working space allowed them to get in touch with each other, have creative conversations over many cups of coffee, collaborate professional skills and eventually co-create content through their very own partnership firm. Yes, spaces can create businesses – such is the power of this new age real estate concept called ‘co-working spaces’.

Gig economy, youth and hassle-free operations

The gig economy is the new reality not just in the West but in India as well. The concept and nature of ‘work’ are rapidly changing with a young, tech-savvy, mobile workforce that no longer wants to stick to a straight-line career. India’s ‘multi-potentialites’ are well on their way to having multiple careers in a single lifetime and making this possible is the gig economy that helps workers get employed for time bound or task bound ‘gigs’.

One of the many facets of the gig economy is the rising demand for co-working spaces – an idea whose time has come in India. Many youngsters are choosing to have non-linear careers as freelancers, entrepreneurs or remote workers for large corporations, creating a demand for swanky, digitally enabled, new age offices that are affordable. Paying a monthly rent of Rs 8,000-15,000 per seat for a fully functional modern office in a prime location makes far more business sense for a struggling entrepreneur than buying/renting real estate and setting up the entire infrastructure from scratch.

India is the world’s youngest startup nation with more than 70 percent founders under the age of 35 years and for the country’s Gen X, Y or Z or whatever we are calling the youth of today – workspaces need to enhance creativity, contribute to collaboration and networking, be flexible, adopt latest technologies and yet be affordable. No wonder then that co-working spaces saw new entrants and increasing competition throughout 2018 and as the trend continues to grow, these companies are doing everything they can to attract more and more occupants.

Zen philosophy for mental health

Noida-based Eccosphere – a co-working space startup harnesses the ancient Zen philosophy to offer an environment that helps its users achieve a mind, body and work balance. The company claims its Zen Buddhist design radiates calmness and serenity and fuels productivity.

Eccosphere’s facilities, like those of many other co-working spaces, include unique common areas, onsite staff, superfast internet (it’s the only co-working space in Noida to offer 1 Gbps bandwidth), printers, lockers, cleaning and HR services, private phone booths and more.

But the company has set its USP as being a space that cares for your mental health and allows you to keep stress at bay. Its infrastructure includes a Zen garden, a library, a room for power naps, a yoga and meditation zone, a cross fit gym for fitness enthusiasts, a gaming zone along with an indoor park and an outdoor café that provides free refreshments. A round-the-clock facility, Eccosphere has built its entire IT infrastructure on Cisco Meraki and offers virtual office options that are a huge hit with millennials.

Even large corporations are now finding it more economical to lease ready to use, plug-and-play office spaces for the long term rather than invest in buying, developing and maintaining real estate for years to come. Companies like Amazon, Microsoft, Arcelor Mittal, Tata Communications, OLX, Jaguar Land Rover and hundreds of others have booked lakhs of seats for their respective workforces at co-working startups like WeWork, Smartworks, Awfis, Regus, CoWrks, 91Springboard and a whole host of others.

Catering to luxury clients

The premium or luxury co-working space is another area that is seeing growing demand. Avanta, founded in London in 2004, entered the Indian market a decade ago foreseeing a market opportunity in the flexi offices segment. “When we entered the premium co-working space, we were told the market is limited but now we have full occupancy in these offices. This is why we are expanding further,” says Nakul Mathur, MD of Avanta India whose client list boasts of Rolls Royce India, Confederation of British Industry, Thomson Reuters, EY and others.

Avanta India’s five co-working spaces in Delhi are located at prime realty spots like Nehru Place, Connaught Place, Saket, Aerocity and on NH 8 in Gurugram – areas that are the target spaces for luxury brands across sectors. “As office rentals are rising across business districts in India, co-working operators will be looking at meeting a requirement of around 9 million sq ft. in one year’s time. The main focus even for MNC clients remains the same as that for startups – saving operational cost, time in setting up and achieving flexibility as against traditional offices,” says Mathur.

Technology as the big bait

India’s largest co-working space provider, Awfis has made ‘technology’ the front, back and centre of its offerings. It is collaborating with What3Words to provide its clients a seamless way to locate each of its 63 centres across 10 cities in India. What3Words divides the entire world into 3m X 3m squares, transforming the entire geographical dynamics with a highly sophisticated and unique algorithm that guides consumers to their destination with a level of precision that traditional means cannot offer – with a simplified 3 word address.

On the B2B side, Awfis is leveraging technology to target mid and large sized corporates with its recently launched Awfis Enterprise Solutions (AES). The gamut of services offered by AES includes workspace design and build, project management, IT services, workspace management, concierge services and specially curated experiences. AES also allows easy access and connectivity to a huge community of over 19,000 professionals and 1500 companies that uses its centres pan-India. “Having garnered tremendous success in the co-working landscape, we continue to identify operational gaps and varied business opportunities in order to provide our customers with enhanced services amidst continued efforts to provide a superior office space experience,” said Awfis CMO Sumit Lakhani at the time of the AES launch.

An investment for the future

According to a JLL report, most institutionalised co-working operators have been seeing near 100 percent occupancy levels with a break-even period of just 5 months, suggesting that co-working spaces may even overtake the traditional serviced office by the end of 2020. Mumbai, Bengaluru and Delhi/NCR currently top the preference list of co-working companies but large scale operators are even eyeing tier 1 and tier 2 cities in the long run as new age technologies make remote working a norm and startups look to solve hyperlocal problems in small towns.

The growth potential of the concept is further affirmed by a CBRE report that announces a 277 percent jump in leasing flexible workspaces in just the first quarter of calendar year 2019. But perhaps the biggest testimony to the business model comes from the fact that India’s new age tech billionaires are seeing this as the next big thing. Hospitality unicorn Oyo recently acquired Gurugram based co-working startup Innov8 in reportedly the sector’s biggest deal for Rs 220 crore, with a vision to create 10,000 seats across India and Oyo is now creating 3 different co-working brands simultaneously to crack different price segments.

As paradigm shifts in mentality accept collaboration as the new normal in every sphere of life and emerging technologies like the internet of things and artificial intelligence connect humans to devices for more efficient processes and better outcomes in a simplified manner, the future of work is definitely ‘shared’. If you are a part of the current or future Indian workforce, strap on your seat belts and sit tight in your win-win position as co-working spaces enter heated competition and woo you with mind boggling possibilities!

Mridu Bhandari is Editor – Special Projects at Network 18. One of India’s youngest Ramnath Goenka Awardees in 2007 for her work on rural development, today Mridu dabbles in many subjects ranging from entrepreneurship, education and emerging technologies to healthcare, brand stories and personal finance. On most weekends, she can be found anchoring special programmes on Network 18 news channels.

Co-working spaces are the new tech-hotspots (Mention)

India is leading the growth of flexible office spaces across Asia-Pacific.

Recently, Hyderabad-based Anthill Ventures announced a $100 million fund for Israeli startups. Sensing a warm reception in the investment space, Israeli startups are rapidly venturing into the Indian market and are finding low-cost workspaces in co-working. Oncehub, an Israel-based technology venture, recently set foot in India with GoWork (a co-working facility in Gurgaon) to test the waters. Similarly, Swedish watch company Daniel Wellington entered India by occupying space in WeWork, Bandra Kurla Complex (BKC), Mumbai, to focus on expansion strategies with the help of cost-efficient solutions.

As per a recent CBRE South Asia report, India is leading the growth of flexible office spaces across Asia-Pacific (Apac) while several multinational and Apac-based companies have expressed their interest in the Indian market. The average rent of an office space in India’s prime locations ranges between `100 per square feet (sq ft) and `250 per sq ft along with the additional costs of setting up and maintenance.

Co-working spaces such as GoWork are addressing both long-term and short-term requirements of foreign businesses, as well as providing a business collaborative atmosphere, community and varied amenities like gym, spa, sleeping pods, Netflix rooms, bar, live kitchen, creche facility, frustration zones, etc. Co-working spaces also offer tenures of less than one year, whereas any regular commercial lease asks for a minimum lock-in period of five years.

Sudeep Singh, chief evangelist and CEO of GoWork, says: “We started GoWork with an idea of empowering startups with networking, mentoring, and opportunities for investor pitching sessions. Today, we are enabling startups to save up to 30% in rental costs. Furthermore, startups are saved from the hassles of spending on fundamental allied services such as the internet, phone communication, conference rooms, etc., as such services are already built-in and are of high quality.”

Players such as GoWork, WeWork, Smartworks, AWFIS, etc., are empowering the new entrants to save 15-30% of costs while optimising their operations in a new market, while also enabling them to upsize and downsize their business. These foreign businesses get to save on expenses such as electricity, water, administrative costs, and internet charges. Additionally, these space providers are providing customised services to their foreign occupiers along with financial, legal and logistic support.

According to Singh, India holds the potential for growth across various startup sectors. It has the second largest number of internet users after China and largest number of users of WhatsApp and Truecaller. Seeing the possibilities, international companies are eyeing Indian markets for business growth. “This is very similar to the trend observed during my time in Silicon Valley, where startups come from all across the globe in search of growth and new business prospects,” he adds.

Singh says this trend of international business entering India will grow on a constant basis, approximately at a growth rate of 74% year-on-year.

“India is emerging as a hot market for international startups as well as investors from across the globe. The key drivers that will continue to build this further are cheaper manpower and good talent available in India and the opportunity for increased trade avenues,” he added.

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5 tips on choosing new-age offices / coworking spaces

In your lifetime, you will spend 13 years and 2 months at work! That is 4821 days in total! Would you really want your employees or yourself to spend a major chunk of their lives caged in dreary cubicles?

Think Dilbert. Did he and his colleagues seem happy? Were they productive? Did they foster innovation? The answer is definitely not! This is exactly what Scott Adams wanted to throw spotlight on when he created the notorious, dark and unfortunately relatable comic strip.

The good news is that today there are ready-made office solutions available for enterprises thinking of making the much-needed jump from traditional offices to new-age co-working spaces.

These workspaces are a far cry from Dilbert’s dark and depressing offices. Today’s co-working offices are lively and thriving with immense focus on employee well-being, productivity and growth.

The bad news is that not all co-working spaces are the same. So what are the few things that need to be high up on your checklist when you choose your cool, new co-working office?

Ask yourself these 5 questions and if the answer is in the affirmative, your search ends there.

  • Is the workplace built to enhance productivity?

An idyllic workspace has a direct co-relation with productivity. Look for a co-working space that improves employee engagement through its design and work culture. Studies show that exposing employees to a workspace that provides flexibility, transparency, recognition, etc. enhances productivity and creates more value for the business. No wonder giants such as Google, Amazon, Facebook, etc. are proactively using new-age upcoming co-working spaces to boost productivity of their employees.

According to global research by Deskmag and Deskwanted, in a coworking space 74% of coworkers are more productive, 86% have a larger business network, 93% have a bigger social network, and over 66% feel more creative and collaborate more on projects. If this is not reason enough to move to a co-working space, we don’t know what is!

  • Does it encourage creativity and innovation?

Creativity and innovation demand a conducive and healthy environment. A new-age office should create a suitable environment where people are given the liberty to work in a way that appeals to them. Select a co-working space that allows your talent to be the best version of themselves so they can come up with the next big idea. An ideal co-working space should offer a calming atmosphere with the usage of the right colours, materials, lights and textures. It should allow employees to choose and control their own sensory stimulations so they can put their best creative foot forward.

  • Does it promote happiness?

Employee happiness is not given its due credit. The impact of employee happiness on business is tremendous as happy employees make for successful businesses. Choose a co-working space designed to boost authenticity and individuality. An office that lets employees be themselves, while taking care of their unique needs. Your office should help employees thrive at work and beyond. Look for an informal set-up that helps employees connect, rather than being restricted. Your new-age office should also cover employee wellbeing with facilities such as gyms, crèches, meditation rooms, well-stocked pantry, entertainment room, and more.

  • Is it bringing nature to the concrete jungle?

People in metros are starved to see green lush trees, beautiful flowing water and being in the lap of Mother Nature. Pick a co-working space that brings nature to employees right within the office environment. The new office should incorporate plants, water elements, bamboos, non-toxic paint, etc. Go for a co-working space with a purpose – a green and sustainable building that is powered by solar energy, focusses on zero waste, recycling, and more. It will help employees feel they are doing their bit and contributing to building a better world. Working in a mindful space also helps employees engage and work better.

  • Does the design focus on collaboration?

Community, collaboration, connection is essential for growth of employees and growth of the company. Choose a new-age office that is designed in such a way that people can connect and share ideas in a setting that seems natural and relaxed. The work stations, meeting rooms should help increase engagement without creating disturbance. Pick an office that has collaborative spaces and brainstorming corners with comfortable sofas, benches, loungers, bean bags, etc. to create a comfortable and welcoming work environment.

Last words

An ideal office space goes a long way in keeping employees happy, becoming the office of choice to attract the best talent, retaining employees and boosting company growth. If you haven’t thought about moving your enterprise or startup to a burgeoning co-working space yet, it is time to get moving. You wouldn’t want to stay behind competition after all, would you?

The author is the founder of Smartworks