Office space provider Workspace sees occupancy level returning this fiscal year – ET RealEstate

BENGALURU: Office space provider Workspace Group said on Thursday it expects a recovery in occupancy levels in the current financial year as coronavirus-related restrictions ease in the UK and financial capital London opens up for business.

Office space providers are gradually recovering after work-from-home policies and the economic fallout from the pandemic hurt their margins as costs surge and customers default on rent payments.

Workspace, which owns and manages 4 million square feet of business space in London, said occupancy at its centres was at 20% of pre-pandemic levels by end-March and 30% by end-April.

“Despite the government lockdown, new customer demand picked up strongly through the fourth quarter, with average monthly enquiries of 910 and average monthly lettings of 111,” the company said in a business update.

Workspace said cash collection has continued to be robust, with the company receiving 92% of rent due for the fourth quarter of fiscal 2021 and 84% for the first quarter of the current financial year.

Shares of the FTSE Midcap component rose more than 2% in early trade.



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IWG says sees ‘unprecedented demand’ for hybrid working options – ET RealEstate

BENGALURU: Office rental firm IWG Plc on Tuesday said it has witnessed “unprecedented demand” for its flexible work products, suitable for a combination of office and remote work that has become the norm during the COVID-19 pandemic.

The pandemic has reshaped the office space sector as employers opt for shorter leases and more employees work remotely, forcing providers to adapt their businesses and properties.

The UK-listed owner of the Regus brand said open centre revenue in the quarter ending March 31 fell 16.1%, but that the quarter marked an “a clear inflection point” for its business with occupancy growth resuming in March after months of decline.

“We have seen an unprecedented demand for our flexible work products, which is a confirmation of the positive trend of continued demand for hybrid working,” IWG said.

The recent spike in coronavirus cases globally has compounded the worries for office property providers as governments in hardest-hit countries urge people to work from home and employers delay their return to offices.

Although IWG has identified hybrid work model and flexible spaces as the inevitable future, the company has yet to detail how its real estate needs to change or potential financial impact of such adjustments.

In general, with strict hygiene protocols in place, office spaces are remodelled to ensure social distancing with new seating plans and more spacing, glass-panelled cough guards, and bigger meeting rooms and reduced capacity for elevators.



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Incuspaze launches 500-seater capacity office in Kochi – ET RealEstate

NEW DELHI: Incuspaze, a managed office space provider, has launched over 500 seating capacity centre in Kakkanad, Kochi. The new facility was launched in two phases of 300 and 200 seats respectively, the company said in a media release.

“Ever since the outbreak of the Coronavirus, companies are demanding more flexible options in CRE, with less CAPEX, and in such situation managed offices can really help corporates to save some money liabilities, foster workspace growth.

Propelled by factors like the decentralization of corporate offices and the increase in the demand for satellite offices by MNCs, this spoke, and hub model is here to stay; managed offices have been also opted by the workforce looking for a suitable workspace near their homes,” the company said.

It recently had partnered with Urbtech India Developers to launch managed office space spread across 5 lakh sq ft in Sector-132 at Urbtech Trade Centre. It had also added 2.5 lakh sq ft in Gurugram and a managed office space in Vadodara in January.

Incuspaze said that it has signed over 7.5 lakh sq ft in Delhi/NCR and is in discussions with developers to add another 3 million sq ft of managed office by year’s end.



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Office leasing in seven cities falls 48% in Jan-Mar: Report – ET RealEstate

NEW DELHI: Net leasing of office space fell 48 per cent during January-March across seven cities due to the COVID-19 pandemic, but demand for the flexible space from corporates has increased, according to Cushman & Wakefield.

In its latest quarterly report, property consultant Cushman & Wakefield said the net leasing of office space declined to 35,78,585 sq ft in January-March 2021 from 69,31,922 sq ft in the corresponding period of the previous year across seven major cities.

The flexible space leased by corporate clients increased to 15,523 seats during the first quarter of this calendar year from 10,690 seats in the year-ago period.

“A sharp jump indicates that occupiers are relying on managed space as a smart alternative in the current situation,” it said.

According to the data, the net leasing of office space in Mumbai plunged to 2,01,642 sq ft during January-March 2021, from 8,82,693 sq ft in the corresponding period last year.

In Delhi-NCR, the net office absorption fell to 4,28,469 sq from 15,97,003 sq ft.

The net leasing dropped to 17,24,456 sq ft in Bengaluru from 26,54,939 sq ft.

In Chennai, the demand for office space declined to 1,44,309 sq ft from 2,55,010 sq ft.

The net leasing in Pune, however, increased to 2,76,531 sq ft from 1,73,026 sq ft.

In Hyderabad, the net absorption went down to 6,24,321 sq ft from 8,91,613 sq ft, while Kolkata saw a fall to 1,78,857 sq ft from 4,77,638 sq ft.

Anshul Jain, managing director (SE Asia and India) of Cushman & Wakefield, said, “Since Q4 closed on a positive note for commercial real estate leasing business, the market was hopeful of a gradual return to business as usual. And, the immunisation drive carried out by the government added much-needed confidence.”

Unfortunately, the sudden spike in the number of COVID-19 cases paused the momentum the market had picked up, he said.

“Unless the government rolls out the vaccination drive for one and all, occupiers will continue to remain cautious and market activity is likely to remain muted till the beginning of the second half of 2021,” Jain added.



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