CO-LIVING HOUSING, THE NEXT PROPERTY DEVELOPMENT MODEL
An innovative residential rental model is injecting new life into the idea of communal living for London’s next generation of prospective homeowners.
Co-living as a concept has been attracting single professionals since the boarding houses of the 19th century offered young women, and men, a secure and respectable home-style set-up; but one UK property development and management company is revamping the model for today’s generation.
The brainchild of London-headquartered business, The Collective, the company opened its first 550-unit co-living building in West London this May.
Designed by PLP Architecture, the 11-storey new build tower offers fully furnished double-bedded rooms complete with televisions, desks and access to a range of onsite facilities including a launderette, gym, cinema, library, games room, shared kitchens, roof terrace and private dining facilities, for an all-inclusive average weekly rent of GBP 250 (USD 367).
The chronic shortage of ‘affordable’ housing for people looking to get a foot on the property ladder or even rent quality accommodation has opened a door for creative real estate companies looking to attract Gen Y professionals in that transitional phase between living with family and striking out on their own.
This underpins the premise of The Collective’s vision, with convenience and community at its core. Lease terms are short, a flat monthly fee covers all the necessities such as utilities and cleaning, and the community aspect comes in the form of shared facilities designed to bring people together; all under the watchful eye of in-house community managers.
A new housing model
According to Reza Merchant, The Collective’s young CEO, the idea was a logical next step for the property company, which already had a number of existing smaller co-living properties to its name.
“It was an evolution of our existing model based both on our team’s vision for housing and on feedback we received from our members. There was an appetite for more communal spaces for people to interact and share experiences together. Therefore, when we bought the site for The Collective Old Oak, the provision of ample amenity space was at the forefront of our minds,” he says.
With similar projects like the WeLive concept in New York, which will eventually house 600 residents over 20 floors, taking shape elsewhere, there is also a clear link to the global trend for co-working spaces; another area of development for The Collective.
Says Merchant: “We’re lucky in that we are our target demographic so were able to better understand what young people in London are looking for when it comes to living.”
The project began life as a classic house share model with its original corporate iteration, Share in the City, leasing buildings and sub-letting rooms. The Collective brand was born following the 2012 acquisition of a Camden, North London-located property, which, says Merchant, showed that there was an appetite for serviced living, which subsequently evolved into co-living.
The decision to launch a hitherto untested concept on such a grand scale was a calculated shot in the dark, as he explains: “It takes a lot of determination, and balls, to actually create an innovative concept that hasn’t been done anywhere before on this scale.
“We were constantly told we were mad, but when you believe in something enough you don’t let anything or anyone get in the way of making it happen. We were working on Old Oak for a couple of years before giving it the big PR push.”
The Collective Old Oak
The decision to select the Old Oak area of West London as location for the first community was done with a long-term view, as he explains: “Nash House was an abandoned office building that had been derelict for years, and the root of a lot anti-social behavior in the area. We bought the site and tore the building down in 2013, much to the delight of local residents, and built The Collective Old Oak from scratch.
“We chose Old Oak because of its excellent transport links; it’s a few minutes walk from overground rail links as well as London Underground, meaning you can get into Central London in under 20 minutes. It has also has been billed as an ‘opportunity area’ with the government investing billions in regeneration. In the next few years, with the advent of Crossrail and HS2 it will become a massive transport hub, similar in size to Waterloo.”
The Collective Old Oak offers a range of units with wifi, cleaning costs, linen change, utility bills, council tax and access to all amenities included, plus other partner facilities.
“The convenience store is outsourced to a brand we feel is in line with ours, called Simply Fresh, and we’ve partnered with another brand to create The Common, our restaurant and bar,” notes Merchant.
Units include a predominance of 28-square-metre ‘twodios’, favoured by solo renters, with The Collective also offering a personality matching programme for shared rooms, whereby the onsite community managers – who meet everyone before they move in – try to match people together based on shared interests and personality traits.
A transitional rental solution for young professionals, Merchant expects tenants to stay on average for one to three years, using The Collective as a real estate stepping stone.
Less than three months old, the community is already home to 374 residents, or ‘members’ as The Collective call them, with Merchant confident of 100% occupancy by September 2016.
Aesthetic appeal and functionality have also played a significant role, as he explains: “Design is at the forefront of everything we do. Over the years we’ve been able to gain experience in how best to optimise space and functionality – everything is in the detail. All the rooms are fully furnished, from the beds and tables to pots and pans, to remove the hassle of having to buy anything when you move in.
“In terms of rental prices, we are very competitive when compared to one-bed flats in the area and we offer a lot more value for money than other rental products, such as house shares.”
Targeting millennials primarily, the average age of members is around 28 years old, although Merchant notes that people in their late 30s through to early 40s are also signing up.
Another plus point are the flexible rental terms and monthly payment plan, with a minimum rental period of nine months but the ability to exit the contract earlier if a replacement is found.
And initial member feedback has been good. Says Merchant: “Our community managers sent out a survey two weeks in and the response was overwhelmingly positive. The cinema is very popular and we host weekly film clubs, which are always packed. The rooftop terrace is also a popular one when the sun is shining – we recently did a yoga class there, which was a big success.”
The community will be further expanded this September with the unveiling of a co-working space for 400 entrepreneurs.
“Our members will have free access to a hot desk space so should they want to work remotely, as many entrepreneurs and freelancers do, they will be able to use this at no extra cost. It allows them flexibility and an inspiring environment, plus they have the convenience of it being within the same building as their home without it feeling like they are working from their bedroom! With the co-working space we will be targeting local start-ups and small businesses,” he says.
The spawning of similar concepts is something Merchant is cognisant of but for now at least, all eyes are on Old Oak’s appeal. “As with any new concept I think it will be [contingent on this] before others are willing to invest the eight to nine-figure sums required to deliver co-living schemes at scale,” he notes.
And he is already looking beyond the UK capital as the sole catchment area. “We currently have two other sites in London in different stages of development, but we have plans to expand to other high-density global cities, such as New York, in the next three years, where we envisage our concept would work well.”
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