Insights Co-living Grows More Multi-Dimensional

Co-living is not a new concept in Asia. What is new and more complex to co-living today is how it has evolved into an aspirational lifestyle and how it is attracting the young, old, and everyone in between.

A modest beginning

Before it became the hot trend it is today, co-living was an alternative real estate product that a few developers and investors brought to the market over a decade ago. It brought a relatively basic solution for issues such as young professionals’ long commutes in cities like Makati in Manila, or out-of-reach rental prices in prime cities like Hong Kong or Singapore. The fundamentals of co-living are simple and borrow from older real estate formats like university dorms or workers quarters: Relatively small private spaces with communal spaces, e.g shared kitchen, living and study rooms, laundry facilities, and even fitness areas. 

Growing demand brings growing demands

In terms of aspirations, those who consider co-living spaces no longer see this alternative just as a matter of convenience or affordability. Instead, they expect deeper connections with the space. They demand space personality and curated interiors, often expect to co-live with residents that think alike, and more and more, they want to see their co-residences as communities, with opportunities for closer connections, knowledge sharing, etc. Thus the approach of real estate players is changing in at least two ways. 

First, communal areas must be more than just functional. They are centres of interaction and their size, design and use become a critical decision criteria for those considering co-living products. With this change comes the need for property managers to move from being maintainers of physical space, to being “community catalysts” – there to initiate and nurture on-going two-way communication and more personalised relationships with and among tenants to foster a true community. 

It is worth noting that this is different than the idea of “community manager”. Because if we talk about true communities, efforts to control the interactions and experiences within them end up being a superficial, short-term approach to co-living that eventually underwhelms residents.

Wider interest, targeted appeal

Second, the changing demand means that co-living can (and must) be created and branded to target multiple age groups and “types” of residents. Today we are flooded with “premium” and “affordable luxury” products for young millennials. But developers are slowly realising the opportunities behind other groups and market segments: Affordable co-living, luxury, senior co-living (with facilities and services appropriate to their physical needs), cross-generational co-living and creative co-living clusters, to name a few. 

And new sub-segmentation is being developed on an on-going basis as more and more real estate players move into this product space. This increased competition has put new demands on developers and investors to create sharper brands, tell compelling stories and build hardware that truly aligns with these new promises. Simply picking nice designer furniture is no longer enough. 

Disrupting the disruptor (and beyond)

Finally, we can’t ignore the effects of co-living in the wider market. Co-living has started to reshape the short/mid-term lease markets, taking share from Airbnb, serviced apartments and hotel residences, and will definitely influence neighbourhood dynamics – the mix of retail service facilities, F&B and services that meet the needs of these properties.

Here is a pick of interesting and diverse co-living alternatives in the region: The Nate in Hong Kong, Cohost in China, Puls in Philippines, Livit Spaces in Indonesia, Sun City Kobe in Japan and Hmlet in Singapore.