Coliving consolidates and removes some of its utopian vibrations
Photo: Johannes Eisele / AFP via Getty Images
Since taking off a decade ago, the coliving industry has gone to great lengths to sell an image of collective happiness: not only a stylish furnished room in a hassle-free shared flat, but the accommodation. as a means of creation, conviviality, professional and even spiritual development. Pure House, for example, prided itself on designing “experiences that allow our members to thrive.” Starcity claims to be “Bring the community back to the city”.
In reality, the industry has thrived not because coliving filled the void left by, say, the decline of religion, like WeLive co-founder Miguel McKelvey. once implied. Instead, he filled the void left by declining guesthouses, turn-of-the-century single-sex residential hotels, and ORS. Finding a roommate on Craigslist or Gypsy Housing is miserable and difficult, especially for those who need to move quickly to a place like New York to start a job – or, even more damaging to a tenant’s prospects, find a job. . There are scams, offers so bad they could be scams as well, blatantly antisocial roommates who don’t appreciate having to share their apartments, and the general unease that comes with signing a legally binding contract with them. strangers.
For years, even as established real estate players entered the field and it became clear that major coliving developments at the base were the direction in which the industry was heading, the sheer number of co-living companies seeking to distinguish themselves in an increasingly crowded market meant that exaggerated utopian rhetoric proliferated. If you were a minor player with a head lease on a few properties, charging a premium for bundling olive oil, internet, weekly housekeeping, and West Elm furniture, it made sense to show just how spaces could change lives. During the pandemic, as many cohabitation businesses went bankrupt and consolidated – earlier this month, Common has taken over Starcity’s cohabitation operation of some 7,500 units – it became very clear that coliving was a business, not a utopia. The capitalist commune was ultimately much more capitalist than common.
At first it looked like the pandemic would prove disastrous for the industry – tiny rooms in all-inclusive apartments shared with strangers and the suspension of perks like housekeeping, movie nights and wine tastings. on the roof did not fit well with quarantines and work-at-home policies. But in reality, the coliving industry prevailed by offering what it had always really offered, but was often too afraid to admit it: convenience; apartments which, while not cheap, were even cheaper than studios or got stuck in front of a roommate’s share of rent; and, often, the ability to move on 30 days notice if you find something better (or if you lose your job). As of last fall, occupancy rates had returned to lows of the 90s and are expected to peak in the 90s by the fall, to reach their pre-COVID levels, according to Susan Tjarksen, expert in cohabitation and multi-family real estate markets. analysis firm Cushman & Wakefield. “We always said from the start that coliving would do very well in a downturn. It did better than Class A – Class A was hammered, ”said Tjarksen, referring to the luxury apartment industry. “Coliving has held up in all metrics because it’s really a game of value. Co-living, you come for the price and you stay for the comfort and the community.
The pandemic has revealed which coliving companies have relied more on branding than solid business models to grow. Among the victims were Wander, which aimed at digital nomads; HubHaus, a venture-backed start-up that leased large single-family homes to young professionals before it imploded (spectacularly) last fall; and Quarters, a German company with an expansion of 300 million US dollars ended bankruptcy in February (he still operates a few buildings in Europe). It is no coincidence that all have relied on master leases with landlords – an easy way to become a cohabitation operator, but, in this case, catastrophic when vacant homes in expensive cities soared. and that rents have fallen.
Other major consolidated players: Starcity has acquired the assets of rival Ollie, and was in turn acquired by Common (but not its real estate development side). Outpost Club, a small business based in New York and New Jersey, took over what was to be Quarters flagship in Williamsburg with 160 beds during the pandemic. The upheaval was not surprising, according to Tjarksen. “We expected the tree to shake. We always thought this consolidation was going to happen. COVID did it in one year instead of five, ”she said.
But was all this upheaval enough to change the coliving conversation once and for all, to end all the dinner talk and neo-homesteading?
In November new York Time item of the people who had moved into shared apartments during the pandemic, reasons included: “It was very straightforward and easy”, “It was definitely the easiest move-in experience I have ever had “,” I came here because it was a very attractive price with very good features “, and” He was attracted to the rental model by room because he would not be responsible for replacing roommates.
Many coliving pioneers seized the opportunity to drop the quasi-hippie mantle. For years, Common has always been a property manager (he does not own the cohabitation building he operated) – but now he takes on the role, describing himself as a “residential brand and operator that designs, leases and manages multi-family properties to appeal to today’s tenants” – which has enabled the company to achieve the scale that many of its competitors do. not. Nowadays, only about half of the properties it manages are cohabitation spaces; the other half are private apartments. Brad Hargreaves, CEO of Common, attributed Common’s success in the era of the pandemic to the fact that “we have always been affordability fundamentalists. We’ve been very straightforward in saying it’s about affordability, it’s about convenience. If you’re not in a position to come up with a really strong value proposition, I don’t think the people who saw it as an intentional community have, too.
Years ago Hargreaves said new York that they had given up on Sunday potlucks because “nobody really cooked, so it was mostly a ‘seamless potluck’.
Chris Bledsoe, one of the founders of Ollie, who once launched an autonomous social club to organize events for his apartments, is now co-founder of Dandi, a British company which, with Dukelease, is opening a flagship coliving building in London this fall. It will have 367 efficiently designed studios and two full floors of shared common space for members, but no shared apartments. Rather than social programming, Dandi focuses on vertically integrated design and construction, including the transformation of specialty furniture. “What I learned from leading Ollie is that social programming and housekeeping alone are not enough to make the business model work,” he said.
Other ground-based coliving projects also fit into what is known as ‘mixed living’ – that is, traditional studios and bedrooms, which both make it easier to finance buildings. and allow them to retain residents who have outgrown. ”Co-living, either through coupling or, as is often the case, earning enough money to be able to afford a luxury building without having to deal with roommates.
Yet there are some holdouts. Treehouse, in LA, is exuberant utopian: “Treehouse is not just a place to lay your head and store your belongings, it is a place and a space to explore through dinners and relationships, partnerships and collaborations, and sometimes support, a spoken and unspoken encouragement and inspiration. “He claims to have performed very well during the pandemic and is now”try to cure the loneliness of LA. “There is also Tcollective, whose declared mission is “to build and activate spaces that promote human relationships and allow people to lead more fulfilling lives”. But the company’s location in New York, the Paper Factory, is reserved for short stays (less than 30 days), which dilutes the collective experience. And the Collective is now apparently under pressure, explore a sale.
Ultimately, the ethic of cohabitation, at least in New York City, may be best captured by the Outpost Club. slogan: “Easy moving. Easy life. “The residents I talked to in a Bed-Stuy Outpost apartment a few years ago, they had no illusions about becoming best friends with their roommates or finding inspiration or themselves through co-living. They just needed short-term accommodation – a safe, clean space that was friendly enough to stay for their first few months in the city, before returning wherever they came from or finding a cheaper apartment to live in, alone or with their true friends.