'Factors such as working professionals seeking better lifestyles, traditional housing challenges, community and networking, and urban migration for jobs are driving the growth in the co-living segment.'
As an outstation student, 25-year-old Ashmita Das was struggling to find accommodation in Bengaluru upon joining her engineering college. But that was until she discovered the advantages of co-living through a recommendation from her classmate.
On entering the space, Das discovers it to be remarkably accessible, with top-notch infrastructure, amenities and digital features.
As demand picks up in the post-pandemic era, co-living startups are expanding their capacity to meet the requirements of customers, mostly working millennials, looking for affordable living options with flexibility.
The Indian co-living market is projected to double by 2025, reaching almost $13.9 billion across the top 30 cities, according to a report titled Co-living: Redefining Urban Rental Living, from commercial real estate service firm Cushman & Wakefield. The sector is also experiencing a gradual increase in funding activity.
Ambitious growth plans
Co-living operator Settl, which manages over 4,000 beds spread across 60 properties and 1.5 million square feet, aims to double its capacity by the next financial year.
“This ambitious goal reflects our commitment to expanding our services and meeting the growing demand for quality co-living spaces,” said Abhishek Tripathi, co-founder, Settl.
“Factors such as working professionals seeking better lifestyles, traditional housing challenges, community and networking, and urban migration for jobs are driving the growth in the co-living segment.”
Settl has secured a total funding of Rs 15 crore from diverse institutions and VCs.
In January this year, it raised Rs 10 crore in its pre-Series A round from Gruhas and We Founder Circle to expand its business.
“With plans to expand our network to 8-10 major Indian urban centres, we are targeting areas with a significant influx of young professionals. This strategy not only caters to immediate domestic demand but also sets the stage for future global expansion, aiming to redefine urban living worldwide,” said Tripathi.
Tech-enabled rental
Co-living platforms HelloWorld and NestAway have raised a cumulative investment of $116 million till date.
Aurum PropTech acquired HelloWorld and NestAway in 2022 and 2023 respectively, aiming to create India's largest tech-enabled rental and co-living marketplace.
Collectively, HelloWorld and NestAway currently offer accommodations for 24,000 beds nationwide, with plans to expand to 50,000 beds in the medium term to ultimately reach 1,00,000 beds in the long term.
“Over the next few years, HelloWorld will position itself as the market leader in co-living, offering an unparalleled choice for those seeking accommodation in our operational cities.
"It shall use advanced tech to enhance security and convenience for users and inculcate a sense of community living. Our growth will come at a control on the unit economics path to profitability,” said Jitendra Jagadeva, co-founder and CEO of HelloWorld Technologies and NestAway Technologies.
Custom-built real estate
Bengaluru-based Colive aims to manage more than 30,000 rooms by the end of this year.
It is developing custom-built real estate tailored to meet the specific requirements of co-living arrangements.
Earlier this year, PropTech startup Crib invested $1 million in Crib Plus to digitise India's student housing and co-living market. The new version will cater to the needs of large-scale student housing and co-living brands, as per the company's statement.
According to prop-tech firm Aurum PropTech, investor interest in the co-living sector is gradually increasing after a funding winter for two straight years.
Investments in the sector dropped from $148 million in 2021 to $21.7 million in 2022 and $6 million in 2023.
“With strong fundamental demand backed by urbanisation, consumer behaviour, and digitisation, institutional investors and global funds favour co-living and data centres as an alternative asset class,” said Onkar Shetye, executive director, Aurum PropTech.
Expansion spree
- The Indian co-living market is projected to double by 2025, reaching almost $13.9 billion across the top 30 cities.
- Settl, which manages over 4,000 beds across 60 properties and 1.5 million sq ft, aims to double capacity by the next financial year.
- HelloWorld and NestAway cumulatively offer 24,000 beds nationwide; they plan to expand to 50,000 beds in the medium term and reach 1,00,000 beds in the long term.
- Colive aims to manage more than 30,000 rooms by the end of this year.
Feature Presentation: Rajesh Alva/Rediff.com
