Coworking Spaces are often confused with real estate businesses by many people. This also leads to misinterpretation regarding Coworking Space Agreements. Some people think that the Coworking Space agreement will have to be similar to that of a Lease Rental agreement. In reality, the agreement of Coworking Space is not similar to a lease agreement. A coworking space agreement in India is generally a service agreement, something similar to that of a business centre or a hotel.
A coworking service agreement will typically allow the coworkers to use the space just like they would use a hotel, use and leave. It does not need necessarily be a rental agreeement, rather it will also list down all the amenities and services being provided by the Coworking Space to the Coworkers.
Things to keep in mind while signing a Coworking Space Agreement in India
- Do ensure to have a clause that states very clearly that this is NOT a RENTAL LEASE. It should be clear that it is a service agreement.
- Do write clearly the security deposit clause/setup fees if applicable.
- Do ensure that the per person price is mentioned clearly and do not write a lumpsum cost because the team sizes may grow.
- If there is a head lease clause to be included, then also attach the head lease along with the service agreement.
- Do ensure that the notice period clause (if applicable) is written in the agreement in order to avoid any confusions later.
- Disclaimers & responsibility of damage and penalty clause is very important, do take care of that aspect.
- Clarify the Coworking space operational days, timings, holidays in the agreement only so as to avoid any confusions later.
- Do ensure that no hidden costs whatsoever are left out. Clarify everything in the agreement itself.
Coworking Space Agreement in India is an important formality to be completed between the Coworking Space owners & the coworkers that are going to use the plug & play office. If these things are taken care of in the beginning, both the parties can have a great journey together.