Co-living, Student Housing To Be Growth Drivers For Realty Sector: ASSOCHAM-JLL Study
Student housing and co-living would be among the major drivers for growth in residential real estate in the second half of 2019, while over half of such market would emerge in Delhi-NCR and Bengaluru in the next four years, according to a joint ASSOCHAM-JLL study.
It projects a demand for the shared rental market at 5.7 million beds, offering a huge market opportunity of Rs 1 trillion by 2023. Such a market was estimated at 3.6 million beds in 2018. Delhi-NCR and Bengaluru will account for more than 50 percent of this cumulative capacity, going forward.
The paper also expected developers to continue their efforts towards completing and handing over under-construction projects. Besides, ''a stricter regime for regular asset monitoring will be initiated by NBFCs/housing finance companies themselves'', the paper by ASSOCHAM and global real estate consulting and research firm, Jones Lang LaSalle (JLL) stated.
While the concept of co-living and student housing is not a new phenomenon in India, it was largely confined in the unorganized sector in several cities with the student and working population. However, the co-living concept brings a drastic transition in the manner in which physical space is managed. It transforms the real estate product into a service akin to the hospitality sector. In co-living there is greater emphasis on spaces such as dining and living area. The emphasis is also on supporting facilities such as gym, mobile apps, and house-keeping. These features are not available in self-rented accommodations.
The paper noted that a few international and domestic players are entering this segment either on their own or through joint ventures with private equity firms. Some hospitality firms are also leveraging their experience in end-to-end fully managed co-living spaces. "For asset owners also it is a good opportunity to realize rental yield '', the paper said, adding, '' the unsold residential units can also be converted into student housing and co-living spaces by developers in case they are located near office corridors or university areas''.
In the last two years, there has been the entry of various operators in this area of the realty business. Oxfordcaps, CoHo, Zolo Stays, Stanza Living, Placio, OYO Life, Housr, Ziffy Homes and Nestaway are a few companies operating in this segment in India. Besides metros and their suburbs, the co-living is spreading to Tier-2 cities as well.