Co-working spaces up investments in ESG for rise in demand, higher rentals

Co-working spaces like Urban Vault, Incuspaze, The Executive Centre, and Awfis in India ramp up investments in ESG (Environmental, Social, and Governance) practices to meet the growing demand for sustainable workplaces. Based in Bengaluru, Urban Vault saw a 41% increase in rentals for ESG-certified properties in the latter part of FY24. CEO Mr. Amal Mishra highlighted a shift where sustainability now drives corporate leasing decisions, particularly as global capability centres (GCCs) expand operations in India. Urban Vault plans to quadruple its investment in ESG initiatives to US$ 4.8 million (Rs. 40 crore) for FY25.

Incuspaze, headquartered in New Delhi, noted a 7-9% rental price gap between ESG-compliant and non-compliant buildings. Founder Mr. Sanjay Choudhary emphasized their commitment to energy-saving technologies and sustainable design practices, with US$ 9 billion (Rs. 75 crore) earmarked for ESG initiatives covering 500,000 sq. ft. of space. The Executive Centre (TEC) observed a 3-5% rental premium for green buildings, reflecting increased corporate preference and regulatory compliance. Managing Director Mr. Manish Khedia stressed the need to expand green building availability in India to enhance its global competitiveness. TEC plans to allocate 5-8% of its investment towards ESG initiatives to capitalize on the rising demand for sustainable office spaces.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.