Kochi: Increasing land price and difficulty in finding large contiguous parcels of land in Kochi is compelling developers to explore the possibilities for developing ‘co-working spaces’. The advent of startups, as well as interest shown by various corporate companies in setting up office spaces in the city, is pushing realty developers to focus on building structures which facilitate ‘coworking spaces’.

“A few guys here are seriously considering the possibility of developing such spaces,” said Creadi representative M V Antony. He said that many startups and multinational companies, who want to open their office, but at the same time did not want to make major investments for setting up an office, could choose to rent out a trendy space in a building which provides world-class amenities. Coworking spaces will help in saving on the additional cost spending for furnishing, maintaining support staff and installing power and water supply systems and providing other amenities and resources for the three or four employees employed by them. “These spaces can be rented for three or four years. There will be immense scope for business development and network working. Later, if required, they can move out and set up their own spaces,” added Antony.

In the survey, ‘Unravelling Kerala Real Estate: A study on Kochi, Trivandrum and Thrissur’ released by Credai, it has been stated that land rates are expensive in Kochi and large contagious parcels of land are difficult to find. The asking rate is in the range of Rs 45-Rs 60 crore per acre.

Most of the office spaces consist of standalone structures built on a plot which is less than an acre. Also, a large portion of the office stock comprises of mixed-use structures with lower and upper ground floors dedicated to retail, which commands lucrative rentals as compared to office spaces.

In the central business district (CBD) regions like MG Road the rental rate per square feet falls in the range of Rs 50-80. In regions like Kadavanthara and Panampally Nagar it is in the range of Rs 45-60 per sq feet. In the secondary business district (SBD) East regions from Edappally to Vyttila Junction (NH bypass) commands rent in the range of Rs 55-75 per sq feet. Meanwhile, in the peripheral business district (PBD), which include Kakkanad, the rental rate per square feet is in the rage of Rs 40-47 (Info Park Phase 1) and Rs 35-37 (Info Park Phase II).

While most of the tenants occupying the structures in the CBD are banks and financial institutions, the tenants in PBD are technology and software service providers. The spaces available at SBD East are mostly leased out.

CEO and country head of JLL India Ramesh Nair said CBD-SBD is a dense cluster where not only the land rates were expensive, but demolishing an old structure and reconstructing it was also very expensive.