Over half of European investors plan to invest in the co-living sector in the next three years – an increase of 13% and the highest growth rate in all ‘Living’ sectors – according to a new publication from Savills, that also provides an in-depth exploration into the current state of the co-living sector and predicts the future performance for the residential offering that is still developing in the UK property market.
A new publication from Savills has explored the current state of the co-living sector in the UK and highlighted that over half of European investors are planning on investing in co-living over the next three years, over €2.6bn of capital is expected to be invested into co-living in the next three years, and the number of new beds completed and opened to residents has more than doubled in just one year – with another 25,000 beds in the pipeline.
“Activity in the co-living sector has more than doubled since the pandemic.”‘‘
Despite being a relatively new concept for residential living in the UK and with co-living still struggling to be recognised by planning officials and investors alike, the co-living sector is “rapidly gaining momentum” in the UK property market.
In 2022 there were 2,000 new beds completed and opened to residents in the co-living sector in the UK, which more than doubled the number of co-living beds in the UK from 1,422 to 3,422. This trend is reportedly expected to continue with an additional 4,999 beds currently under construction in the co-living market and the significant surge in co-living pipeline activity that has occurred in the UK property market since the beginning of the Covid-19 pandemic in early 2020.
Between 2015 and 2020 there were applications for 10,520 co-living beds to be built in the UK, however, in just the three years since then, applications for a further 12,150 beds have now been submitted which clearly indicates a growing appetite from investors, developers, and lenders for the co-living sector.
“The pandemic has also increased the desirability of co-living accommodation for residents, due to its emphasis on community and resident interaction.”‘‘
Although there are not many co-living schemes currently in the market, Savills reports evidence of “strong lease-up rates and growing rental values” therefore indicating a significant demand for this type of residential offering from residents. Providing an attractive option for people moving to a new city, co-living creates an ideal environment to establish new friends, colleagues, and a community due to its vibrant social scene and extensive amenities.
“Co-living in its simplest form is purpose-built rented housing, where residents have their own self-contained studio apartment and there is lots of shared amenity space throughout the building, often including co-working spaces, gyms, and cinema room … Target residents are students, recent graduates and young professionals who want to live in vibrant urban centres, with a strong sense of community and access to amenities.”‘‘
At Beech Holdings we have experienced incredible demand for our rental properties with amenity spaces and social events, which is why we have developed a new residential brand, City Co-Living, that is designed to bring together the security and independence of living in an apartment with the added luxury of a wealth of onsite amenities and an extensive social calendar to match.
City Co-Living MediaCity will bring residents the opportunity to live in luxurious self-contained apartments in the heart of Salford Quays with a range of amenities just a few floors below them, including a media room, residents’ lounge, co-workspaces with bookable pods, a state-of-the-art gym, and more – with a rooftop terrace on the top floor.
To learn more about how you can invest in the co-living sector and join the 51% of European investors looking to invest, get in touch with our expert team or contact them directly on +44 (0) 161 791 4600 today.