The last decade has witnessed rapid development of immersive virtual reality (IVR) and its application in various contexts. However, its application in supporting real-time virtual collaboration has been quite rare due to technical barriers and the lack of validated design principles. To address this research gap, this study designed and developed an IVR space to enable multi-user synchronous co-located collaboration. An evaluation study (N = 95) was conducted to explore its useful design considerations and the influencing factors for collaboration experience. The IVR space was enabled by the simultaneous localization and mapping (SLAM)-based inside-out tracking technique and was informed by four essential design considerations for promoting effective collaboration in IVR, namely, the role script, learning task, collaboration mechanism, and communication design. The study results revealed that students in general were satisfied with their collaboration experience in IVR, with social presence and collaboration competency as significant predictors of collective efficacy and social experience. Based on both quantitative and qualitative results, this study proposes four validated principles for designing effective IVR spaces to support synchronous co-located collaboration.