The co-living space heats up with real estate biggies making a beeline

While builders such as Embassy and Brigade are aiming at creating exclusive coliving brands, others are investing in startups active in the segment

As millennial employees are reshaping rental housing, real estate companies are making a beeline to grab a share of the growing co-living market in India. While Bengaluru based Embassy Group will be investing Rs 2,000 crore to build a co-living community in six cities, another builder Puravankara is also foraying into the segment by end of this year.

Called Olive by Embassy, the Embassy Group’s co-living facility will be launched in Bengaluru, Chennai and Pune this year which will be followed by expansion in Hyderabad, Mumbai, and Delhi-NCR next year with a vision to take the brand international over the next few years.

“There are over 36 million students in higher education and the migrant millennial workforce is growing at a rapid pace across metros.  Olive by Embassy aims to uplift the standard of living for this segment with hospitality services and an eco-system that will support our country’s youth in their academic and professional pursuits. Additionally, our co living projects will complement and add value to our large tenant base at our Embassy Office Parks,” said Aditya Virwani, COO, Embassy Group and co-founder of Olive.

Priced between Rs 10,000-20,000 per bed depending on the market, Olive’s first phase will see the launch of 20,000 beds in total with 15,000 beds in Bengaluru and 2,500 each in Chennai and Pune.

The Puravankara team has identified Goregaon in Mumbai as its entry point into the co-livings space which would be about 350,000 square feet. “At this juncture we are in the process of deciding if this is something we should start as a new brand or if a tie up with an established co-living operator would work better,” said Ashish R Puravankara MD, Puravankara Limited.

To keep with the times, another Bengaluru-based realty company Brigade Enterprises is also evaluating the co-living sector as a natural extension of its residential business. It has so far identified three projects namely Brigade Cornerstone Utopia and Brigade El Dorado in Bengaluru and Brigade Xanadu in Chennai to foray into co-living. “We are looking at 2,000 beds to start with in these three projects,” said Pavitra Shankar, Executive Director, Brigade Enterprises.

According to a Cushman & Wakefield report, this segment is reported to more than double in market size from $6.6 billion in 2019 to $14 billion in 2025. Going by the recent trends, co-living may also offer a higher rental yield of as much as 8-11 per cent, as compared to the current average yield of 1-3 per cent in residential properties. This is why brands are flocking to the industry, say experts. Interestingly co-living startups such as Oyo Life, The Hello World by Nestaway, Zolo, Guesture are already competing to outpace each other in the segment.

Not only are real estate giants creating co-living brands, they are also investing in startups active in this segment. While Lodha group MD and CEO Abhishek Lodha and Godrej Properties Executive Chairman Pirojsha Godrej invested in co-living startup Housr last year, Bengaluru-based startup Colive raised $9.2 million from real estate company Salarpuria Sattva.

Real estate firms making a beeline to grab a share of India's co-living market

• Embassy to invest Rs 2,000 cr to build co-living brand Olive

• Puravankara to foray into the segment by FY21 end

• Brigade identifies 3 properties to venture into coliving

• Salarpuria Sattva invests $9.2 mn in Colive