The growth of luxury coliving has helped drive interest in the sector, with one study reporting that it was now attracting couples.
The report came as a new coliving brand was launched in India, under the name Covie.
According figures released by Built Asset Management, there was a 136% rise in enquiries from couples seeking shared rental properties in London between June 2019 and June 2020.
Alex Gibbs, co-founder & director of BAM, said: “Our enquiry data shows a very evident shift in the attitudes of couples towards co-living accommodation over the past year, with many more coupled-up Londoners now actively seeking this type of rental arrangement. Economic factors are undoubtedly at work, with coliving offering an affordable option to renters seeking high-end accommodation, without the expense that comes with a single-let unit. However, co-living has also undergone something of a revolution in recent years, with an influx of luxury properties onto the market.
“Whilst this data spans a 12-month period, we have also seen a sharp spike in enquiries from couples since the market re-opened in the wake of the Covid-19 lockdown. Over the coming 12 months, we very much expect this trend to continue, particularly when factoring in the financial uncertainty that the pandemic has brought to many young couples across the capital.
“Much of the existing coliving property market in London is limited to the number of couples it can accommodate, due to availability of amenities and local authority regulations. The key takeaway here for investors and developers, therefore, is to ensure that newly created co-living premises have both the amenities and the regulatory approval to house couples in as many of the units as is possible and practical. This will enable them to bolster returns, drive occupancy, and efficiently serve these new entrants to the coliving market.”
In India, two real estate entrepreneurs have launched Covie, with more than 3000 beds in Pune, Bengaluru and Mumbai. Abhishek Kumar, co-Founder, Covie, said: "For the ever-dynamic millennial population, co-living is one of the most preferred means of housing as it provides a safe, secured and convenient choice in a new city. To keep up with the demand and comfort of our customers, we intend to enhance the overall experience by the adoption of innovative tech capabilities so that more and more people seek location independent lives without compromising on their quality of life.”
The pair was aiming at more than 30,000 beds over the next three years and claimed to be the only player in India catering to all the three segments together; namely students, professionals, and senior citizens under the brands Covie Ed, CovieLiv & Covie Plus.
Global funding in the coliving space has increased by more than 210% annually since 2015, totalling more than USD3.2bn, according to JLL.
JLL said that the coliving concept had moved from a small group of apartments with rooms and common areas, to an asset class with amenities that resemble conventional Class-A multifamily or student-housing sectors.
“In a very short period of time, a whole new class of multifamily residential assets entered the market,” said David Martin, who co-leads JLL’s US multifamily investment sales platform. “The sector is receiving a lot of interest.
“The coliving trend is absolutely tied to affordability in major markets. We see rapid growth in cities that are economically prosperous, particularly gateway and unaffordable markets. There’s a change in the ideology of residents there. connect with the ideology that you don’t need to sacrifice nice finishes and location, just change the way you’re living. The established multifamily markets lacking affordability are not only found in the US, but also Germany, the UK, Hong Kong, and India, meaning that coliving space is set for rapid expansion globally.”
Insight: I grant you, Covie is a punchy name to go with during the pandemic and it would be crass to say that the founders wanted to see it spread like what one hopes is not its namesake. But what makes the launch interesting outside the thrilling lack of focus grouping is that it seeks to be all things to all people. In urban India, as with many other urban areas, decent accommodation isn’t just inaccessible to those at the beginning of their working lives, it’s inaccessible to many other groups.
What started out as somewhere to put students after they stopped being students but aren’t quite grown ups is now collective living for all. And this contribution-to-wider-community angle is not lost on developers.
In Devon, one developer has shifted plans to build student accommodation into building coliving. Iain Smith, planning director for the Watkin Jones Group, said: “We know that Exeter City Council has identified that co-living developments such as this will provide much-needed housing to help retain graduates in the city, helping it meet its ambitions for employment and productivity growth. Our proposal will also, unlike purpose-built student accommodation, contribute directly to the city by way of council tax which will be paid via the building’s operator.”
Investors have been encouraged to look outside hotels during the pandemic, for property which cannot be so easily closed down. With the position of students not looking as clear as it might at the minute, coliving appears more bankable and, for areas where partying students have rankled residents, more conducive to a happy community.