Millennials prefer a more sophisticated and community-based approach to rental accommodation than traditional rental options.
The rising migrant population of students and working professionals in the metros has kick-started India’s co-living culture in all seriousness. Delhi-NCR, which offers high-grade education and employment opportunities, was bound to become a dominant co-living hub sooner or later.
This new real estate asset class largely caters to millennials, who have made it clear that they prefer a more sophisticated and community-based approach to rental accommodation than what the traditional PGs, hostels and vanilla rental options have to offer.
Cities in NCR such as Delhi, Gurgaon, Noida, Greater Noida have seen phenomenal growth in co-living options, which now range from private rooms to shared apartments and even entire bungalows and row-houses.
Several co-living start-ups like Zolostay, Oyo Living, NestAway, CoHo and Stanza Living are now very active in this exciting new segment, bringing with them the necessary expertise. Their brand value and presence across the top markets give them the leverage to reach out to a wider audience.
As an education and employment hub par excellence, Delhi-NCR has tremendous growth opportunity for such players. Stanza Living, for instance, has grown from a mere 100 beds to over 2,000 beds and 16 residences across Delhi, Noida and Greater Noida. Likewise, Oyo Living has more than 34 properties in Gurgaon and 20 in Noida that offer co-living options. Nestaway has more than 2,200 co-living options in Noida, Delhi, Ghaziabad, Greater Noida, Faridabad and Gurgaon across the three categories of shared rooms, the entire house and private rooms.
• As per ANAROCK data, nearly 30% of co-living spaces are located in adjacent residential micro-markets of the IT parks or office spaces in NCR. These are usually costlier, and their monthly rentals can go as high as INR 40,000 depending on facilities provided.
• Pricing of co-living options varies based on different parameters like unit size, location, type of society, amenities, and sharing etc. To be cost-effective more than 50% co-living spaces are situated into the interiors of the residential areas rather than on main roads.
• Interestingly, accommodation for men and women are in the ratio of 2:1 out of the overall available co-living spaces in NCR. Average monthly rentals for women range between INR 8,000 – 10,000 while for men it is in the range of INR 7,000- 9,000 per month.
• The average area for single sharing room is 300 sq. ft. – a configuration which accounts for nearly 60% of the available stock in the single sharing category
Most of the large start-up players replicate the tried-and-tested model practised in the developed markets of the West, which often appeals to a large section of their Indian customer base. However, given the diversity of the Indian ethos, we are bound to see some India-specific evolution in this model. For instance, the unspoken mantra that co-living is only for young people may not stand the test of time in India.
[This is an article by Santhosh Kumar, Vice Chairman at ANAROCK Property Consultants. All views, opinions and expressions are personal and limited to the author.]