Could this new trend be the future of multifamily housing?
As apartment rents continue to rise across the United States, some of today’s renters are looking for new ways to live. The new trend of co-living is promising to answer the call, with the potential to forever change how investors operate their properties.
What is co-living?
The concept of co-living is emerging as a new way for people to live in cities. Especially popular among younger people who are recent migrants to places like New York, Boston and Los Angeles, co-living offers convenience, flexibility and a sense of community.
Consisting of shared, fully furnished houses or apartments, co-living spaces typically offer WiFi, hotel-style services and communal areas. Residents have a private bedroom and can enjoy the community atmosphere that comes with sharing a kitchen, dining areas and lounges.
How popular is co-living?
While dismissed by some critics as “dorms for adults”, the popularity of these shared homes cannot be disputed, and many experts see co-living as a major emerging category in the real estate market.
The concept is relatively new to the U.S. but growing fast, with new co-living communities springing up across the country monthly — and that includes Florida. Common, a New York-based company that operates 20 co-living sites in major cities, is expanding into Miami with two brand-new developments in Little Havana that will open in 2020.[1]
Gunther Schmidt is the founder of the Berlin-based Medici Living Group, which boasts over 1,600 beds in its portfolio and has just launched the Quarters co-living concept in New York City. “We make co-living not only attractive for students”, he says, “but we develop it as a housing concept for all young, urban people who want to live centrally and be part of a large community.”
Co-living communities are often found in up-and-coming neighborhoods that are attractive to younger renters, with good transport links and close proximity to restaurants and nightlife. In the case of Quarters, the company master leases apartment buildings from developers. Residents can sign up for leases as short as three months, and rent tends to be below average for the local area.
And it’s not just for millennials: the concept of co-living for seniors is also beginning to gain traction.[2] Aside from Common and Quarters, other U.S. co-living companies like Ollie and WeLive also have hundreds of beds in their portfolio, and have recently received substantial investment from established real estate companies.
Is co-living the future of multifamily housing?
Co-living is an exciting new development in the multifamily landscape, and one which we’ll be watching closely.
Our opinion: It certainly fits the bill as a short-term living solution for new migrants to big cities, as well as those looking for a community atmosphere. But for the longer term, we firmly believe that traditional multifamily housing options will stand the test of time.
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