The Shared Accommodation Industry Post-COVID-19: Challenges and Remedies
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A new form of community living, co-living, has caught the attention of a generation that is constantly on the move and hopping from one city to another in search of better education and job opportunities.
According to a recent Cushman & Wakefield report, by 2025, the co-living market size in the top 30 cities in India is set to increase by $13.9 billion. At 440 million, comprising 34 per cent of the nation’s total population, India is home to the largest millennial population globally. Slightly lower than that is the growing ‘Gen-Z’ population, currently standing at 32 per cent.
Co-living operators in India are creating spaces that can offer diverse experiences for residents through the adoption of technology, social events in well-designed community areas, terrace gardens, cafes, gyms, etc. In addition to cost-efficiency in such models, the plug-n-play co-living set-ups offer autonomy of flexible entry and exit choices. The modern, collaborative concept of ‘shared everything’—from cab services, workplaces to music services—has also enabled a cohesive business model for the co-living industry. The co-living market in India has been evolving rapidly, with newer operating models coming into play. It has brought in opportunities, primarily catering to young working professionals and the student population that is being serviced by a barrage of startups.
Assessing the impact of the pandemic
The pandemic has compelled us to prefer places that offer greater safety and given that most of the world is still working from home, they prefer places that offer comfort. Also, social distancing for more than a year has induced a strong need to build and sustain human connections more than ever before. The traditional PGs and hostels, with poorly maintained accommodations or limited safety and hygiene facilities, no longer offer the standard suited to meet the needs of the modern young workforce and students. Plus, landlords’ lack of oversight or standardisation has left fewer options for the young urban demographic looking for affordable accommodations.
Considering the long-term challenges posed by COVID-19
Given the current situation of ‘work from home,’ which is not a permanent solution, the co-living sector is a segment that is equipped to offer an ecosystem focused on enabling business continuity, along with creating an environment that promotes healthy and safe living. A hybrid of work & home (W&H) where employees stay, work, live, learn and socialise, all in the same managed, customized environment with access to workspaces can enable business continuity while protecting the health of employees. In fact, it could work out to be a good risk mitigation strategy from potential liabilities while ensuring a seamless client experience during the pandemic.
Major challenges faced include:
- Ensuring hygiene and sanitisation
- Maintaining social distancing
- Ensuring the wearing of masks in the premises as well as outside
- Providing proper medical facilities
- Managing operations and maintenance costs
Establishing guidelines for hygiene and safety
People may want to shift from unorganised PGs to more organised ones who follow standardised practices. They must implement hygiene practices like frequent building disinfection, deep cleaning, daily and frequent sanitisation of high-touch surfaces.
The evolving pandemic and lockdown have momentarily slowed down operations. With social distancing norms set to continue for the foreseeable future, co-living spaces have reinvented themselves. Cleanliness and hygiene will take prominence over all other things, and this is, in fact, an opportunity for the organised players.
Recovering from the impact of COVID-19
The idea of co-living seems counterintuitive to social distancing. But after a year of self-isolation, people are craving human connection, even if that means living with strangers. According to a November 2020 report from Cushman & Wakefield, co-living properties rose a staggering 23 per cent higher than conventional properties in Q3 2020.
Though it will take some time for things to stabilize, the real estate segment should bounce back, especially with professional players coming in. The market size of the millennial migrant population is over 20 million that includes students, young professionals, young couples and gig workers who have moved to the top eight cities in the country according to JLL & Knight Frank.
Co-living is one of the most beneficial means of accommodation for the ever-moving millennial population, by providing an affordable, convenient, and safe choice in a new city. It also eliminates the problems faced by bachelors while finding a good apartment.
The idea is to change the perception and stereotype around the existing cold, rigid housing block and create a superior solution to this long-pending challenge. The segment is growing in the cities as it is a new concept. It may take some time to develop. Hence, co-living, while still a nascent industry in India, is set to become a key determinant of a new community lifestyle – not only serving as a steppingstone and a bridge between their familial lives and careers - but also providing freedom of thought while co-existing with like-minded people.