Co-living is a natural extension of the coworking concept, which are all part of the sharing economy. The trend is catching on fast with China leading the pack in Asia.
Co-living is a form of housing where residents share living space and a set of interests and values. It is part of a modern, urban lifestyle that values openness and sharing, and aligns with the general shift towards ridesharing/carsharing and coworking. In particular, co-living can be seen as an extension of the co-working trend that see people share office space and common facilities in order to save costs and share ideas.
Co-living houses may offer short-term accommodation and host regular events for residents, many of whom are students, startup founders or employees, young professionals, as well as artists and creatives. In a sense, it is student accommodation for grown-ups.
GLOBAL PHENOMENON
China is a trailblazer in this space in Asia. YOU+ International Youth Community already offers rooms of between 22 to 50 sqm to young people in Guangzhou and Beijing.
The trend is also catching on in other markets. Campus Hong Kong operates a co-living facility after converting 48 one-bedroom apartments into four-bed dormitory rooms. In India, there are currently four startups that focus on co-living operating out of Gurgaon, and two based out of Bengaluru.
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Singapore has been slightly lagging, but Ascott, CapitaLand’s wholly-owned serviced residence arm, unveiled the lyf brand last year and partnered with the Singapore Management University to field-test co-living concepts.
WHY?
Co-living in ‘adult dorms’ appeals to the millennial generation, who are more open to the idea of social networking and the sharing economy. Not surprisingly, we see very strong interest in the co-living concept in cities with a growing wave of millennial workers and travellers, and hubs that attract technopreneurs, startups and the creative industries.
Co-living is also inspired by the coworking phenomenon in Asia over the past few years. Some operators now extend beyond co-working to bring together work and lifestyle under one roof. For example, Beijing-based real estate startup 5Lmeet opened a centre in Beijing that includes an open office and amenities such as gym, restaurants and event space.
Rising accommodation costs also play a part. Many singles, students or young workers find conventional apartments out of their reach because of high rents, deposits and furnishing costs. Although pricings of co-living space are quite diverse, they are generally more affordable. The size of co-living space also compares favourably with small flats coming to the market – micro-apartments as small as 20 sqm has marketability in Hong Kong.
DIFFERENTIATION …
Co-living space providers differentiate by: Location is important, either in the city center with a ready catchment of business travellers or close to university and technology hubs. YOU+, the most famous co-living start-up in China, will open two new communities in the Haidian district of Beijing, the location of two of China’s top universities, and the Zhongguancun technology hub.
Many co-living hubs are furnished and have communal facilities for residents to connect and collaborate. These spaces can be easily converted into zones for social activities such as talks, music and cooking sessions, or workshops. Some hubs further distinguish themselves by locating in lofts or heritage buildings. For example, lyf@SMU in Singapore is located within a conservation building built in the 1900s, with fun colours and quirky design elements.
Many investors already actively pursue options in the market to create flexible co-living facilities. Given limited opportunities on the market and tight pricings, we expect value-add specialists, in particular, to devote more resources towards opportunities in co-living space.
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