Not a millennial trend but a necessity: The success of co-living decoded
The gig economy enabled by digital technology has caused Industry 4.0 and laid the foundation for the future of work. With millennials making up 75% of the workforce by 2030 and an increasing amount of resources to work remotely alter the way individuals move, work, socialize and live. As coworking has become a social movement of 3.8 million members by 2020, a concept of co-living is stepping into the spotlight. As trendy and exclusive as co-living may seem with its members-only policy, selection of tenants and authentic branding, its further expansion is a necessity and strategic answer towards extreme urbanization and lack of affordable housing. Recent investment figures show accelerated growth of co-living and its international outreach with Medici Living Group securing the largest investment in co-living of 1 billion euros ($1.13 billion) for its European expansion. Co-living is an international phenomenon. According to JLL Hong Kong, co-living has more diversity of operators entering the market and has secured more investment than the other two main options as a retail and traditional office. With Welive’s expected entry to the Indian co-living market in 2019, the concept of shared living is being rolled out globally.
However, the success of co-living is only partially explained by its convenient plug-and-play model which offers all amenities being taken care of by the provider of the space. Co-living is a strategic tool to beat the shortage of affordable housing in the metropolitan areas and reduce the number of commuters, thus, improving infrastructure of the cities. Depending on the provider, renting a space in the co-living complex comes as a less costly option than renting your own apartment. And most importantly, co-living offers something that is hard to quantify - the community of like-minded individuals at one’s doorstep and social interaction with one’s neighbours. The selling point of the co-living concept is not its fully-furnished private rooms but genuine connectivity with one’s flatmates and welcoming atmosphere of the environment. It is suggested that co-living might even become a solution for decreasing alienation of urban workers from each other.
Service model has successfully altered the way we live. Globally.
Co-living falls under a relatively new concept of Housing as a service (HaaS) or space as a service. It is disrupting the way we screen, monitor and select housing. Co-living is seen as a promising potential from industry experts from different market leaders as the real estate developers, hospitality companies, and investment community. Big names in the retail- and automotive industry are adding co-living to their portfolios. Ikea launches its Space10 which is an innovation lab based in Copenhagen. Ikea labels Space10 as its secret research lab where the future of sustainable living is explored. The business model around co-living is a service model which is one of the key attributes of sharing economy. As Uber has transformed the way we move and use a taxi, co-living giants as Welive and Collective are changing the way we allocate resources while making housing decisions. Ownership over goods is no longer attractive for consumers and the trend towards servitization is taking over. Users nowadays prefer access-based consumption, thus, short-term contracts and the opportunity to rent a space is becoming a preferred option over property ownership. As workforce transition is leading to an increasing number of mobile workers, the flexibility of movement from one location to another makes modern employees rethink their housing options to the benefit of co-living providers.
Changing profile of a co-living tenant
As co-living is expanding on an international level, the public image of a co-living tenant is being altered as well. It soon will be a thing of the past when the majority of tenants was comprised of digital nomads or young professionals. Industry leaders and innovative thinkers predict that co-living might serve as a solution to tackle social problems such as a lack of affordable housing for the ageing population. Figures from the UN report show that by 2050, the number of people older than 60 will increase to 2 billion worldwide. According to the Health and Retirement Study (HRS), 43% of people over 60 reports that they feel isolated. And co-living which offers a welcoming network of tenants might decrease high levels of loneliness and social isolation. Senior lifestyle housing has already been included in some of the real estate providers’ portfolio. New Ground Co-housing based in High Bernet (UK) is the first co-living project for senior citizens. It is women-only and tenants’ age ranges from 50 to 87 years. An alternative lifestyle is becoming a reality now for everyone regardless of age and socio-economic background.
Co-living: power of decentralized technology
According to Ikea’s innovation hub SPACE10, disruptive power of the co-living concept is enabled by digital technology. The service model of co-living provides open platforms, digital applications and tools for granting access and management of one’s space, communication board with tenants and online payments system. Democratic nature of digitization makes processes faster and allows more individuals to perform their transactions. GitHub as an open source technology might become the platform for the co-living experts to share industry insights to optimize their processes. With the development of blockchain, rental contracts no longer create confusion between tenants and owners of the space. Decreased number of mistakes in records and early detection of fraud will be possible with smart contracts. Furthermore, co-living industry leaders invest in white-labelled applications designed for a particular co-living complex to manage community, events and practical matters.
To enable security of their spaces and real-time management, co-living companies choose SALTO KS which is a standalone cloud-based smart lock solution. Granting and revoking access for a definite period of time is a necessity for co-living community managers and is enabled by SALTO KS via its own management platform which controls all the doors of one’s space.
If you would you like your own SALTO KS solution, you can ask for a price quote or even schedule a demo right here.
SALTO KS provides a flexible access control management system that requires no software installation or the added expense of a fully-wired electronic product. Modern cloud-based, wireless access control system is easy and simple to use for businesses including Coworking Spaces, Coliving Buildings, Purpose Built Student Accommodation, Retail, Multi-Tenant Housing, Gyms and many more. Our best in class wireless access control solution and smart locks guarantee the efficiency for your business. Integrate smart locks, start easily managing wireless access control now!