Communal or co-living, whereby tenants accept smaller living/sleeping areas in exchange for much larger communal spaces and an emphasis on social interaction, is, possibly, the fastest growing area of property investment. The reason why it is expanding so quickly is because it offers a solution to the shortage of affordable housing for young people in the world’s major cities. Another benefit is that it removes the isolation that many people experience when they move to large conurbations. Plus, younger people are now much more mobile and they appreciate shorter rental contracts, serviced spaces and lower levels of financial commitment.
The first developer in the UK to appreciate the potential offered by co-living a company called The Collective (https://www.thecollective.co.uk). They have recently created a purpose built co-living space in Old Oak Common, North West London. It is just next to the Bakerloo Line tube station and just 25 minutes from Oxford Circus. The typical rent for a one person apartment is £1,000 a month. I say apartments but really they are little more than bedsits. Why are people rushing to live there? Because of the shared spaces. Each floor contains a themed relaxation area catering to a range of moods and entertainment needs, from library, spa and private cinema to a Japanese tea room. There is also something called a ‘disco launderette’, whose washing machines and tumble dryers will share the space with two disco balls a sound system and a dance area. There is also a gym, restaurant and bar as well as a co-working space with up to 350 desks, available for non-residents to rent. Communal kitchens on every floor offer impressive dining spaces. The Collective promises that there will be lots of planned and impromptu events.
The monthly rent, by the way, includes all bills, electricity, cleaning, use of the gym, council tax and even Wi-Fi. Indeed, apart from food, everything is all found.
The UK is not the only place to embrace communal living. WeWork, the sixth fastest growing business in the world, now worth a staggering $16 billion, is launching communal living like this in New York. In Hong Kong, Peter Pfister, a Swiss hotelier, runs the Camper’s Hong Kong development where he has just converted 48 one bedroom apartments into 48 four bedroom dormitories containing individual pods housing a desk a wardrobe under an elevated bunkbed. All around the world other developers are launching similar spaces.
Finally, a thought. I believe that very similar projects could be managed on a much smaller scale and not just for young people. There is no reason why communal living for the middle aged shouldn’t be popular.