Third, cost. Many co-living spaces offer just a room for rental, while others offer a bed and table. This allows individuals to rent a room for about S$1,000 in a central location.
With up to 85 per cent of co-living guests under 40 years old and many still finding a foothold in their careers, the sector’s clientele is relatively price-sensitive.
Challenges such as inflation and financing costs abound for co-living operators. However, co-living companies cannot overprice their products, especially in a highly competitive market of about 20 players with consolidation on the horizon.
Flexibility, community and costs are key reasons why co-living has taken off in cities such as London, San Francisco, New York and Singapore over the past few years. In Singapore, it is not uncommon for co-living operators to report 90 per cent occupancy.
CO-LIVING AS A HOUSING SOLUTION
Beyond short-term drivers, there are long-term factors that are likely to ensure that co-living will continue to thrive in Singapore.
For one thing, land is finite. And while buildings are getting taller, there is a limit to how many more new buildings can be built. Instead, a better way would be to reuse buildings more efficiently.
Take the housing of nurses for example, who are in high demand as Singapore ages. MOH Holdings in August 2023 launched a tender for five sites with vacant buildings to be retrofitted into hostels for a total of 1,800 foreign healthcare workers. In a joint venture, The Assembly Place and dormitory operator TS Group won the tender for three of those sites.
