WeWork India raises ₹500 cr; CEO says on path to being 'debt-free'

Flexible workspace operator WeWork India Management Ltd (“WeWork India”) has raised Rs 500 crore via a rights issue. The funds will be used to repay debt, strengthen the company’s pathway to debt-free, and reduce its cost of capital.

Karan Virwani, MD & CEO of WeWork India, says with the recent completion of a rights issue, WeWork is on the path to being "debt-free". "This underscores our investors/shareholders' trust and confidence in our vision and strategy in India. With this capital infusion we aim to strengthen our balance sheet by repaying existing debt and aim to drive growth which will cement WeWork India's position in the industry.”

WeWork India says it is currently operational across 8 cities, with over 1 lakh desks, with "strong relationships" across key stakeholders such as landlords, international property consultants (IPCs), and members. Since 2016, WeWork India has expanded across 63 centres in Chennai, New Delhi, Gurugram, Noida, Mumbai, Bengaluru, Pune, and Hyderabad.

Rapid expansion of coworking spaces

With over 99,000 startups and 107 unicorn companies valued at $30 billion, India has the world's third-largest startup ecosystem. This dynamic environment has led to the rapid expansion of coworking and managed office spaces, embraced by both startups and large corporations across various sectors such as IT/ITeS, pharmaceuticals, banking, financial services, insurance, software-as-a-service, and financial technology.

Market analysts predict a substantial increase in the flexible office space market, projected to grow from 55 million sq ft to 100-140 million sq ft by 2030. This growth is fuelled by a growing demand for flexible workspace solutions, with 54% of Indian companies opting for coworking spaces to optimise costs while offering employees a range of workspace options to enhance productivity, business continuity, and market reach.

Highest-ever GLV in office sector

India’s office sector closed 2024 with historic achievements, recording an 89 million square feet (MSF) of gross leasing volume (GLV) across the top 8 cities, according to Cushman & Wakefield’s latest office data. This marks the highest ever GLV recorded in the sector, surpassing 2023’s peak by a significant 14 MSF and a 19% increase. Gross leasing volume, which factors in all leasing activity in the market, including fresh take-up, open market renewals by corporates as well as pre-leasing, is an indication of overall market activity. This performance showcases three consecutive years of consistent growth in the office market activity, reinforcing India’s position as the office of the world.

In terms of cities, Bengaluru led the charge, accounting for 29% of India’s GLV (25.93 MSF), followed by Mumbai at 20% (17.84 MSF) and Delhi-NCR at 15% (13.14 MSF). Hyderabad and Pune rounded off the top five cities with shares of 14% (12.31 MSF) and 10% (8.47 MSF) respectively.