Co-living firms partner with realty companies for customised spaces
Co-living startups such as ZoloStays, Co-live, Hello World, Oyo Life and Stanza Living are partnering with real estate developers and retail asset owners to construct customised buildings, with the promise of rental yields of as high as 9%. These startups lease the entire building, generate customer demand, and manage the property including maintenance to amenities like Wi-Fi connectivity, furnishings, housekeeping, power backup, and security. They pay either a fixed monthly contractual payout or strike a revenue-share deal for tenures of 5-10 years, providing a new revenue opportunity to developers at a time when growth in the traditional housing market has stagnated at 2-3%. “The ‘co-living’ concept is now accepted as an emerging asset class within the ambit of alternative real estate, offering a sustainable solution to the urban space crunch,” Zolo Stays cofounder and chief executive Nikhil Sikri said. Zolo Stays has more than 2,000 apartments under construction based on this model, scheduled to go live by 2021, Sikri said. This year, the company plans to add 30,000 beds. The average rent per month is about Rs 7,000 per bed. Builders actively working on this model include the DRA Group and Olympia Group.
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