Is Office Space Still A Worthy Real Estate Investment In The Work From Home World?

As Covid-related uncertainty is fading and the hybrid work paradigm becomes the norm, office space leasing is expected to increase.

Share on facebook
Share on twitter
Share on linkedin
Office space investment

With the third wave of the pandemic fading, commercial real estate’s near-term prospects are expected to improve. This segment’s long-term prospects are determined by the rate of economic growth. Commercial real estate in India has strong long-term potential, as it is one of the world’s fastest-growing economies.

Only 1.8 billion individuals have high-speed internet access in 2010. It has grown to 3 billion by 2016. Experts predict that by 2022, the whole world’s population of 8 billion people will have access to high-speed internet. All of these connections paved the way for organizations to embrace remote labor. Before the coronavirus, 4.7 million individuals were working remotely, according to a renowned real estate portal.

Overhead expenses were cheaper, and research revealed that working from home enhanced productivity in many circumstances. Plus, we were able to hire people from all over the world at comparable pay, which is critical in places like the Bay Area and Silicon Valley. The coronavirus epidemic hit, and 88 percent of the world’s corporations supported or required remote labor, according to the studies.

If you believe we’ll all go back to work after the epidemic is over, think again! The statistics and patterns tell a different picture! Fortunately, these improvements will improve the way real estate is done and provide investment options.

Also Read: 12 Ways A Smart Owner Can Identify The Right Real Estate Investment Opportunities.

Positive attitude

Work From Home (WFH) has harmed the prospects of commercial real estate, as businesses have been letting go of leased locations to save money on rent. Corporates are bringing their staff back to work, removing the uncertainty that has surrounded the office as an asset class since Covid’s inception.

In the future, India’s standing in the global economy is anticipated to improve. India’s worldwide market worth has constantly risen. It has evolved from an outsourcing destination to a multinational company’s research and development center. It’s also an important consumer market for goods and services.

According to a renowned real estate website, net absorption in the Indian office sector reached 11.56 million sq. ft in October-December 2021, the most in the recent eight quarters and up to 86% quarter-on-quarter. For the half-yearly period of July to December 2021, net absorption increased by 26% year on year.

Also, Read Smart Real Estate Investments: What Are Grade A, B, C In Commercial Properties.

Time to enter

Commercial real estate experts say now is a terrific time to invest. WFH has generated doubts in the minds of investors. Companies, on the other hand, are now considering a hybrid work environment in which the office plays an important role. Investor confidence has risen as a result of this.

The market appears to be improving, with lease activity picking up in the top seven cities in 2021. Many offices already have opened, and many more are expected to start soon. As a result, this is an excellent moment to invest in commercial real estate.


A good location may bring a 7.5-10% yearly rental return on office space. There is also the possibility of capital growth. This asset class’s returns are likewise quite consistent.

Locations to bet on

Investors can visit any of the country’s bustling corporate and business districts. Bengaluru continues to witness significant demand from start-ups as well as the IT/ITeS industry. The city’s most popular areas include the Outer Ring Road, Electronic City, and Whitefield. HITECH city and Gachibowli are two of the most popular areas in Hyderabad. It’s MG Road, Sohna Road, and the DLF IT parks in Gurugram. It’s largely OMR in Chennai. The BKC region and Worli are popular tourist sites in the Mumbai Metropolitan Region (MMR).

Apart from Mumbai and Pune in the west, Bengaluru and Hyderabad in the south, and the National Capital Region (NCR) in the north, Kolkata, and Chennai are gaining traction among investors looking for chances. He goes on to say that micro markets in areas with substantial infrastructural development have promising futures.

Also, Read 9 Things you should consider while investing in Commercial real estate.

Important considerations

Investors must carefully pick the property to generate excellent profits. The major concerns should be location, occupier profile, and entry and exit pricing. The property should be in a high-demand area with a consistent tenant profile.

Due diligence is essential. Make sure the property title is clear and that the paperwork procedure goes well. RERA registration is required if the project is still under development. Exiting from a commercial real estate venture can be difficult at times. REITs are thus a viable choice for commercial real estate investment. In India, all REITs are owned by firms with substantial portfolios.

Coronavirus and remote working comes hand in hand in altering people’s business and personal life. Coronavirus didn’t make us want to work from home; it only made it easier for us to do so. From all the work we had previously achieved, we were only able to adjust so swiftly. While the entire impact of that rapid transition has yet to be seen and understood, we now know that remote working is here to stay long after the epidemic has passed. Assetmonk offers individuals who want to invest in commercial real estate without having to manage a physical property the opportunity to buy institutional-grade commercial real estate through a thorough research-based process. Assetmonk helps customers with their investing difficulties and offers a variety of CRE investment options.

FAQ'S on Office Space Investments

Businesses who previously opposed working from home owing to concerns about data security or increased hardware and network expenses may soon discover that they have no choice. Businesses will struggle to justify high real-estate expenses as success stories about increased employee productivity and quality spread throughout enterprises, and some will point to a BAU (business-as-usual) experience.

In the case of residential real estate, WFH had a short-term detrimental influence. WFH, among other things, contributed to the drop in house sales.

Related Articles

istockphoto 1394977436 612x612 1

Commercial Real Estate Leases: Different Types and Which Is the Best?

Leasing commercial space is a significant financial commitment and requires commercial real estate leases. These leases can be intimidating, especially because they are a huge commitment that can be costly. However, they are not as difficult as many people believe. A commercial real estate lease, like most other legal transactions, should not be taken lightly. As a result, when renting commercial space for the first time, it is critical not only to thoroughly study the industry but also to have a good understanding of the many forms of commercial leases accessible in India. Also, read Commercial Real Estate Is Booming In 2022: Explore How You Can Also Profit Via This Alternative Investment. Here’s an explanation of the many forms of commercial real estate leases and what they imply for renters and landlords: Firstly, what are commercial real estate leases? Commercial leases, as opposed to residential leases, are an arrangement between a renter (company) and landlord that specifies the property only…

Read more
istockphoto 817688664 612x612 1

The Indian real estate market would be worth $1 billion by 2030: RBSA Advisors

According to RBSA Advisors, the real estate business gets expected to grow by 15% by 2030, reaching $1,000 billion. According to RBSA Advisors, the Indian real estate sector would grow at a 15% CAGR from $60 billion in 2010 to $1,000 billion by 2030, contributing 13% of the country’s GDP by 2025. The organized retail real estate industry get expected to rise by 28% to 82 million square feet by 2023. Per “The Outlook of the Real Estate Sector in India,” the Indian real estate sector is showing strong indications of recovery as the economy recovers from the pandemic. Also, read JLL reports Indian real estate garnered $943 million in investments worth in Q1 2022. Despite a little increase in prices and a slight increase in home loan interest rates, the real estate industry has thrived on good buyer enthusiasm. According to the poll, there is substantial demand for property in Delhi-NCR across all price levels. The entire increase in…

Read more
istockphoto 1394786542 612x612 1

Aspire to be A Top Commercial Real Estate Agent? Here are Some Critical Steps To Becoming One

Do you want to be a successful commercial real estate agent? The Indian real estate market is diversified but vibrant and competitive, particularly for commercial real estate agents. To build a successful niche, they must comprehend the shifting promotional circumstances of developers as well as customer preferences. Staying current and afloat in the market requires innovation and openness to new marketing concepts. Follow the steps below to be a top agent. Do you want to be a successful commercial real estate agent? If this is the case, the first question you must answer is whether you want to work in commercial or residential real estate. To be sure, because individuals are more likely to buy or lease a place to live rather than a location to operate a company, it is simpler to get into residential real estate – where there will always be more prospective clients and transactions. Commercial real estate, on the other hand, may attract a large…

Read more
istockphoto 1263914795 612x612 1

Real Estate Investments: The Hottest Alternative Investments You Do Not Want To Miss Out

One of the best ways to grow your money in the modern era is by making investments. Whether small or large, every investment has got the potential to be a profitable one. It wasn’t long ago that people only knew about the stock market as a primary investment method. But, this has changed pretty much with the arrival of better technologies for making investments and making profits out of them. The hottest topic in the domain of investments is the growing popularity of alternative investments such as real estate. The real estate industry has been in existence for a long time, but it has changed a lot from its original form. Better alternative investments are emerging in real estate, mostly due to innovations introduced by technical firms. There’s still much to learn about this, so don’t worry. We have explained everything about this trending topic in this blog post. Do not miss Aspire financial freedom. Find Out How Real Estate Investment…

Read more
istockphoto 953511340 612x612 1

A hike in housing sales across India in 2022

Despite increasing mortgage and housing rates, India’s residential market is predicted to maintain demand pace this year, with sales likely to exceed the demand that was before the pandemic, at a peak of 2.62 lakh units, according to industry stakeholders. After enduring four consecutive interruptions in the shape of demonetization, RERA, GST, and COVID-19 in the last six years, industry analysts believe the housing market is undergoing fundamental changes and is now at the commencement of a long-term implicit. The FPCE, a homebuyers’ organization, attributes the better buying sentiment to the Real Estate Regulatory Authority (RERA) established under the Real Estate (Regulation and Development) Act of 2016. All major publicly traded real estate developers reported record-breaking bookings in the previous fiscal year and have stated that their sales statistics in FY ’23 would be much better. However, if the entire market is considered, rather than just listed businesses, the RBI’s move to increase the interest rate by a total of…

Read more
istockphoto 973712582 612x612 1

Office space demand recovery gets broad-based as small, mid-sized deals pick up

The pandemic had a significant negative impact on the commercial real estate sector. Public gatherings were outlawed to slow the spread of the virus, which put a stop to corporate demands for office space. Numerous developments are coming in from all over the world as things are improving every day. A solid recovery is taking place in the commercial real estate market, especially in the small- and medium-sized office space segment. Since the beginning of this year, both the volume of direct transactions and lease agreements have significantly increased. Deals are being secured across a broad spectrum, with the majority involving office spaces between 10,000 and 50,000 square feet. The 10,000–50,000 square foot commercial office space is starting to see an increase in transactions, according to Real Estate Investment Trusts (REITs) and many other well-known builders with a sizable portfolio. Surprisingly, additional transactions that go above and beyond the upper limit are also being recorded. What does that imply? Due…

Read more