In co-living space, millennials find a home

When 23-year-old Sushant R got his first job in Bengaluru, he made up his mind that a co-living space will be his first choice for a home. For millennials like Sushant co-living spaces provide cheaper accommodation, in addition to offering a community living experience.

Players like StayAbode, ZiffyHomes, CoLife and CoHo are a few that are investing in creating infrastructure suitable for community living and disrupting the home rental market.

Co-living is a recent trend in the real estate space where a company takes up space from a developer and creates the co-living space complete with amenities like food, lodging and Internet facilities.

“Rentals in Tier-I cities are exorbitant. Plus most millennials seeking jobs outside their city find it a painful task to find flat-mates. A co-living space can be a hassle-free experience,” says Viral Chhajer, Co-Founder and CEO, StayAbode.

Chhajer, who has already received two rounds of funding for his venture, says the company is looking for a third round. StayAbode uses real-estate efficiently giving property owners higher yield on their properties.

“Our occupancy is close to 95-97 per cent. We are currently expanding in Bengaluru itself,” Chhajer said adding that the company works on an asset-light model. It merely leases and operates a co-living space and does not invest in real estate space.

Another player ZiffyHomes started its operations in Delhi. “We started as a sub-leasing model but now run co-living spaces. We look at ourselves as a service provider,” says Sanchal Ranjan, Co-Founder, CEO, ZiffyHomes.

He said the company has also tied up with developers to take property on long-term lease and convert it into co-living spaces.

“We assure minimum rentals to developers and also keep an asset-light model. The owner gets higher rental from the property because of higher occupancy rate and professional property management without having to micro-manage the entire process.

The tenants get their ready-to-move-in rooms without depending on other flat-mates with a unified monthly bill which includes all other miscellaneous expenses,” he said adding the company has close to 350 properties in Delhi-NCR alone.

The rentals in these establishments range from ₹11,000 to ₹30,000 per head for shared spaces and services.

Another player is Bengaluru-based CoLife which had seed raised funding of $1 million in 2016. The company also plans to expand its operations to Hyderabad, Pune and Gurgaon after consolidation in Bengaluru.

Industry watchers point out that the entry of such players will bring not just standardisation in co-living set-ups but also provide a monetisation opportunity for developers and home-owners who may be sitting on an idle inventory.

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