Co-working Spaces in India opts Green Practices for High-Rental Returns

In India, co-working spaces like Urban Vault, Incuspaze, The Executive Centre, and Awfis are investing more in ESG (environmental, social, and governance) practices because they offer higher rental yields and because more businesses are looking for workplaces that are ESG-compliant.

India’s goal of going emissions-free by 2070 is the backdrop for the increased ESG investments. The third and fourth quarters of FY24 saw a 41% increase in rentals for ESG-certified properties, according to Bengaluru-based Urban Vault.

It was also mentioned that the majority of businesses are now deciding whether to lease buildings that meet international ESG standards.

Speaking to this, Amal Mishra, CEO, Urban Vault says, “Urban Vault has seen a significant rise in demand for ESG-certified properties. Almost all negotiations for office spaces now include sustainability as a key metric. With more GCCs (global capability centres) coming to India, ESG standardisation has become a norm. We are investing in ESG-compliant projects to meet the growing demand. Corporates are increasingly looking for office spaces that can contribute to their overall sustainability strategy and goals”.

Sanjay Choudhary, Founder and CEO, Incuspaze states, “Our key ESG practices include implementing energy-saving technologies such as LED lighting and energy-efficient HVAC systems, and conducting regular energy audits to identify areas for improvement. We prioritise sustainable design by using eco-friendly materials and construction practices, and by designing workspaces to maximise natural light and reduce reliance on artificial lighting”.

Manish Khedia, Managing Director, West India, South India, and Sri Lanka, TEC expresses, “The rise in demand for ESG-compliant buildings is evident as MNCs and GCCs become more stringent about their ESG goals, emphasising occupancy in green buildings across their global real estate portfolios. However, the availability of green buildings in India will take some time to match the global average. Addressing this gap is crucial for India to remain competitive in attracting and retaining global businesses committed to ESG standards”.