Header image

News

News

China’s co-living boom puts hundreds of millennials under one roof

youcoliving

In April 2016 WeWork, a $16 billion company that leases office space and then rents it out to startups, launched its most radical experiment yet. It unveiled WeLive, residential properties in New York and DC that house young professionals in pampered, if cramped, apartments with Silicon Valley-style amenities like free yoga classes, daily housekeeping services, and unlimited beer.

The premise was hailed as bold and visionary. But it’s actually nothing new. Co-living for young professionals has been alive and well in China for years—and it is growing much faster than in the US. Nationwide chains offer thousands of temporary housing units for millennials eager to live away from their parents, and with each other.
And they’re raising huge amounts of money. There’s Mofang Gongyu, the Warburg Pincus-backed Shanghai company with over 1,000 units, that raised $300 million in funding in May and is now reportedly worth over $1 billion (link in Chinese). Then there’s Youke Yijia, which raised $22 million in November 2014 (link in Chinese), and Mogu Gongyu, backed by IDG Ventures China and Ping An insurance, which raised $30 million that same month (link in Chinese).

The best-known chain among China’s startup community, if not the largest, is You+. After co-founders Liu Yang and Liu Xin opened the first branch in Guangzhou in 2012, they sought venture capital and quickly established a nationwide chain of residences with the help of Su Di, one of the architects behind Beijing’s Innoway startup hub. You+ currently claims to house over 10,000 people across its 16 branches and has received over $20 million in venture capital funding from prominent Chinese investors including Xiaomi founder Lei Jun.

You+’s residences have a warehouse-chic look not uncommon for co-working spaces, but with a few local twists. In the Guangzhou branch along Baogang Avenue, Chinese pop blasts from the speakers as residents peck at their laptops or play pool. Washing machines take QR codes for payments using WeChat. Cigarette smoking—which would get one exiled in Silicon Valley—is permitted. Ashtrays are on almost every table in the common area.

Most bedrooms are between 20 to 50 square meters, and cost 2,000 yuan ($303) per month to rent. Bathrooms are private. The minimum duration of a stay is six months. Many You+ residents are startup founders or employees. Guangzhou isn’t the startup center that Beijing is, but its large population and proximity to manufacturing hubs like Shenzhen and Dongguan keep its tech industry relatively vibrant. They don’t necessarily choose to live in You+ to save money on rent—2000 yuan per month in Tianhe, on of Guangzhou’s main business districts, will get one a complete apartment of equal size, and prices go lower in more remote parts of the city. But You+ lets young Chinese live in an environment that’s more social than the average apartment complex.

Here’s Why Co-Living Could Be the Next Big Hospitality Trend

zoku-living-area

The concept of “co-living” has been described in many ways: Dorms for adults. The modern equivalent of the commune/kibbutz/boarding house. A solution for the urban housing crisis. A remedy for lonely Millennials seeking out true connections in this all-too digitally connected universe. A new live/work alternative for remote workers and global nomads.

At its most basic description, co-living is about community and developing connections among those who occupy that particular co-living space. Common elements include shared kitchens, living areas, and social programming. Essentially, it’s group living, and it’s being expressed in a multitude of variations, from purely residential constructs to much more nomadic ones. Ranging from ultra-luxury to basic budget, today’s co-living spaces are, in many ways, blurring the lines between residential and transient, social and private, hotel and home share.

But however you choose to describe co-living, one thing is certain: It’s becoming a bigger trend, or a movement. And it’s likely only a matter of time before it starts to emerge in the hospitality sector. In some cases, the early signs are already here.

In future posts we will look at some emerging co-living startups and businesses and how this trend might impact the future of hospitality.

Co-living startups: The commune is back, but for profit

coliving1

Trend alert! Communes are back!

But not in the way you’re probably thinking of. Group housing is a big trend among 20- and 30-somethings (although not exclusively), but this time around, they’re calling it “co-living,” and it comes with a twist: It’s not just a lifestyle, it’s a business model.

Several startups are in the co-living business, which they say is really about redefining real estate as a service model. These companies, like Pure House, The Collective, Common, and even WeWork, are certainly in the real estate business, but they offer housing that includes a philosophy of community, shared space and a built-in social life — and also nice furniture, pre-installed internet and TV service, distributed cooking, grocery shopping done for you, housekeeping and plenty of social activities. Think running clubs, yoga and happy hours.

The trend slots right in with co-working and open cubicles in terms of constant interaction with other people, and it definitely nails a bunch of well-honed millennial stereotypes. I visited a co-living house in Oakland that’s an 11-bedroom Victorian mansion. It’s one of three properties operated by a local startup called Open Door, and the two co-founders live at the house, which is full of earnest, attractive young professionals who talked sincerely about being “process thinkers” and sourcing local, organic beef for their group dinners.

That said, it’s also pretty good living. Sometimes someone cooks for you (and one of the housemates at Euclid Manor, which I visited, is actually a chef), the house itself is absolutely beautiful and fully furnished, there’s housekeeping, someone else handles the grocery shopping, and when there’s a problem, you just send your housemates a note on Slack. Are the residents learning all the survival skills they might need later in life? Maybe not; but they all seem to like it there.

And for companies the business model, which is essentially just property management, with lots of perks thrown in, is promising enough that WeWork, the co-working startup with its staggering $16 billion valuation, is renting crash pads in two co-living locations, one in New York and one in Washington, D.C. So for the second part of my story, I spoke with WeWork co-founder and chief creative officer Miguel McKelvey about how the company imagines housing in the future.

The WeLive model is, or has the potential to be, a little different — it’s not as permanent feeling as something like Open Door and its co-living houses. You can rent apartments (or rooms) for just a few days, a month, a few months or longer. It’s almost like a fancy hotel, but when you check in, you have everything you need, including friends.

You can hear that interview in the Dispatch this week or by clicking here.

Co-living solution for ‘Generation Rent’?

We-Work--Aldgate-Tower

A new building complex in north London is offering a different kind of accommodation aimed at millennials, (people born around the beginning of the 1990s,) mixing small private space with quirky shared spaces.

‘The Collective’ has 550 small bedrooms and communal areas that include a spa, restaurant, games room, library and roof-top with plastic igloos – with most bills included in the rental price.

Is this co-living a good deal, or just another way to exploit young Londoners in the property market?

Video journalist Dougal Shaw went along for a tour of the building, which has just welcomed its first inhabitants.