Vacant Space: Pexels
Over the last half a decade, e-commerce has boomed, creating a market scenario suggesting that real estate is doomed. Based on real-world data, this is absolutely true. Real estate is undergoing a downfall like never before, leaving landlords hapless and clueless about what the future holds for their vast, vacant properties. Brick and mortar retail is struggling to cope with the mad rush of e-commerce, forcing established retailers to shut shops to the tune of hundreds. [1] With millions of people coming online at an incredible pace, this trend is bound to hit India soon.
As more people adopt online shopping, more physical stores will face the brunt and sooner or later be forced to cut down on the massive rental overheads. But this is just one of the factors contributing to the sluggishness of the real estate market. With remote teams turning out to be more productive and cost-efficient, organizations, big and small, are looking to utilize shared workspaces instead of bearing the mounting rentals of dedicated offices. And with every two new restaurants in town, one shuts down. Okay I just made the last one up but you get the picture. According to a report by Knight Frank [2], over 20% of commercial properties remain vacant in India. But this is just commercial real estate we are talking about. What’s up with residential properties? There were over 10 million empty homes in India as of May 2015. [3] And it is not surprising at all. To buy a half decent apartment in urban India, one has to inherit a fortune or decide to get hitched to a housing loan for at least a decade. Besides the ridiculous cost and burden that comes with buying a house, getting tied to a place is something millenials are moving away from. Most of us want to be free, travel freely, live in different places and carve a more meaningful existence for our coming generation and ourselves.
Coming back to the topic, the downfall of real estate has created an amazing opportunity for those who’d like to dig deeper and look beyond the traditional ways of monetizing land and property. For the first time in human history, we have all the ingredients: lot of vacant or underutilized space, ubiquitous technology, and most importantly, open-minded people who put experience over ownership. The concoction of these has the potential to create shared spaces for pretty much everyone and everything- spaces to study, work, and play, to collaborate and create, to hangout or just take a break. Each space with different infrastructure but the same basic pre-requisites will assure access to people from all backgrounds. With just basic furniture and clean toilets, any space can be made into a shared work, study or play space by providing the requisite equipment and tweaking the additional offerings.
One can decide to do individual work or collaborative study, take a class, have a meeting, play a game or pursue a hobby or even leave their kids to be taken care of for a few hours. Businesses can promote themselves, talk to potential customers or sell their products and services without month-on-month hefty rentals. An organic pickle seller can share the room with a fashion accessories brand, and a potential customer might be around to get some quick work done while sipping a cup of coffee. The possibilities are endless. Collaboration has the power to break all barriers and create amazing opportunities and savings for everybody. And with such amazing opportunities and savings, there will be more resources than ever to help the marginalized or provide for the underprivileged.
References:
[1] http://money.cnn.com/2016/08/11/investing/macys-closes-100-stores/
[2] http://content.knightfrank.com/research/659/documents/en/india-real-estate-outlook-2262.pd
[3] http://www.bbc.com/news/world-asia-india-32644293
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