The interest in co-living is on the rise, a direction emphasized by the merger between the largest co-living operator in the US, Common, and their European equivalent, Habyt. The two companies manage more than 4,000 apartments in the US and 7,000 apartments in Europe and Asia, as reported by The Wall Street Journal. The term co-living refers to a modern form of group housing where residents share communal spaces for socializing, cooking, and gathering, and have access to shared amenities such as cleaning services or dog walking.
During the Covid-19 pandemic, many co-living operators struggled due to the imposed lockdowns, falling rents in cities, and the social-distancing mandates. Many co-living tenants have also been forced to adapt and re-think the design of their communities to find ways of living together while mitigating the health risks. In doing so, many discovered that this type of arrangement could be better positioned to handle a pandemic while keeping a sense of normalcy more so than traditional residential real estate offerings.
Recent reports show that the demand for co-living apartments is bouncing back, with occupancy rates at around 90% in the US. The rising cost of living and the worsening of the global housing shortage is also expected to continue to boost this type of flexible accommodation, as many of its customers are young professionals moving to a new city.
In an effort to appeal to these needs in the real estate market, US-based company Common has branded itself as a utilitarian product. Chairman Brad Hardgreaves explains that the company did not set out to create an intentional community, even though friendly and social spaces are encouraged. Fewer than 10% of their applicants cited a desire for community or new connections as the primary driver for seeking co-ling solutions. This represents a change of perspective, as the “community” aspect was one of the main headlines for many co-working and co-living brands.
People seeking to avoid loneliness is a huge factor that was actually increased by the pandemic. Eventually, we all want to get to a place where we use the same technology, the same process, and the same relationships with landlords to manage all kinds of properties for all ages as well. - Habyt co-founder Luca Bovone
Co-living projects are particularly popular in cities with a high cost of living, such as London, where they help tenants combat the issue of rising reals estate prices and urban density while providing additional features and amenities compared to standard living arrangements. The same concept is having a significant influence on the design of residential projects, which have begun experimenting with the Kitchenless Home idea.
