WeWork in talks with multiple Indian property developers

Office sharing start-up, WeWork, is said to be in talks with Indian property developer Embassy Group for a joint venture which would enable WeWork to enter the Indian office rental market for the first time. Bengaluru-based Embassy Group is said to be the favourite to join forces with WeWork, although the US firm is also said to be talking to Oberoi Constructions and Radius Developers in Mumbai, meaning WeWork may well opt for regional deals with multiple developers. Demand for office space is on the rise in India, particularly in Bengaluru, which recorded its highest ever office space leasing activity last year.

BENGALURU: WeWork , the New York-based office rental startup valued at $15 billion recently, is in talks with Bengaluru-based developer Embassy Group for a joint venture to enter India, said people familiar with the matter.Billionaire Jitu Virwani-led Embassy, one of India's largest commercial real estate owners, is seen as a front-runner even though the red hot American startup is still in dialogue with Oberoi Constructions and Radius Developers in Mumbai, and DLF in the national capital region. WeWork could opt for a master joint venture with Embassy or explore regional pacts with multiple developers - a decision it would take soon, sources added.WeWork, the shared office space provider to small businesses and entrepreneurs, takes up office space from big landlords and then sublets it on shorter leases. It then arranges for a range of services for its tenants connected through a digital app. WeWork, co-founded by Adam Neumann and Miguel McKelvey, and considered the fastest growing office tenant in New York, counts Fidelity Investments and T Rowe Price among its marquee list of investors.The five-year-old company, which has disrupted the traditional real estate sector, has spaces across 67 locations in the US, Europe and Israel and is rapidly expanding into new markets. It is currently working on a co-living platform as part of its business development plans. In India, WeWork is likely to initially focus on Bengaluru, Mumbai and the national capital region. It will have multiple locations in each of these cities and would look to take up 50,000-1,00,000 sq ft.WeWork will work with the developers and landlords, charging a management fee for its services.Private equity giant Blackstone-backed Embassy declined to comment on speculation, when contacted. An emailed questionnaire to WeWork remained unanswered at the time of going to press.Demand for office space in Bengaluru has risen over the years, helped by consumption from major startups such as Amazon, Flipkart and Ola which have been taking millions of square feet on lease as they expand. But for smaller startups, a co-working space provides cheaper options.Bengaluru, often called the country's startup capital , recorded its highest ever office space leasing activity during 2015. The city took in net leasing space of 12.3 million sq ft, surpassing the previous record of 11.3 million sq ft set in 2007.