Leasing of office spaces by unicorns is set to increase two-fold from the current levels, as they are likely to occupy about 14 million square feet of office space by 2024.
This is led by large offices that unicorns are likely to lease across major markets of Bengaluru and Delhi NCR, according to a report by property consulting firm, Colliers. Unicorns are likely to lease an average of about 2.7 million square feet of office space annually over the next two years across the top six cities, which is a three-fold increase from the preceding three years.
Ramesh Nair, chief executive officer, India and managing director (market development), Asia, Colliers said, “India has already seen about 15 new unicorns so far this year. At the same time, we are now staring at a funding slowdown in the space which is likely to be a short-term blip. We are likely to see enquires coming back into the market in a few months for flex space, as well as traditional space, especially from fintech, e-commerce and logistics start-ups.”
Overall, the whole start-ups ecosystem comprising of unicorns and non-unicorns are likely to occupy 78 million square feet of office space by 2024, a 16% increase from 2021, he said.
Bengaluru remains the top start-up hub with a 34% leasing share during 2019-22. Delhi-NCR witnessed a three- fold increase in leasing by start-ups during 2021 on a year-on-year basis.
Mumbai, however, has only seen certain pockets of start-up activity over the years due to relatively higher rentals and high cost of living acting as deterrents by early-stage companies.
According to Colliers, while metro cities remain the core hubs for start-ups, non-metro cities are seeing growth in start-up leasing as well as flex space take-up due to low cost of living, reduced capex and work from anywhere trends. “Emerging hubs such as Jaipur, Ahmedabad, Indore, and Coimbatore are likely to witness a rise in flex space and start-up occupancy as entrepreneurs are increasingly leveraging these locations to launch operations,” the report highlighted.