Are we ready for co-living spaces?
Despite technology reducing the need for human interaction, real estate developers in Dubai are trying to bring people together with the concept of co-living. While still an emerging real estate asset class in the UAE, co-living projects (most of which are still under construction) are already showing promise.
From the total number of transactions that took place at MBR City, more than 70 per cent were for the Collective and Socio projects at Dubai Hills, both co-living spaces, according to Chestertons Mena.
Following the success of Collective, and after selling 460 units in one day according to Emaar, the developer launched Collective 2.0. Both phases are scheduled for completion in mid-2021. Other co-living projects under development include UNA by Nshama at Town Square, KOA’s Canvas off Mohammad Bin Zayed Road, and the residential community that’s planned for Dubai Design District in the medium term.
“Despite all of Dubai’s co-living projects still being under construction, off-plan sales have gathered pace in 2019,” Nick Witty, managing director of Chestertons Mena, told Property Weekly. “Year-to-date figures show Collective 2.0 has witnessed 210 transactions, while there have been 317 transactions in Socio, and Nshama has sold 18 apartment units in UNA [this year].”
Who do they cater for
Most of Dubai’s co-living projects will be completed in 2020 and 2021, and they will boast minimalistic interiors and exteriors, gyms, swimming pools, business centres and more spaces where residents can interact, such as cinema and game rooms. With their collaborative and social settings, these projects will cater for young professionals and entrepreneurs, as well as small business owners and work-from-home millennials.
For new expats, co-living spaces are also attractive. From the lower rents to the prospect of making new, like-minded friends, these projects are designed to facilitate interaction.
Some developers are now coming up with other creative schemes, such as Emaar and Dubai Multi Commodities Centre, which are offering a trade license and residency with a unit within co-living projects such as Executive Residences at Dubai Hills. The proposition is attractive for home-based businesses owners and freelancers.
Ultimately, co-living schemes could change the UAE’s real estate landscape in two ways, according to Chesterton’s Witty. One will be priced-based, as co-living units are likely to be cheaper to both rent and buy and could open the market up to first-time renters or new buyers who would have previously struggled to get on the property ladder.
The second way is that it will change the manner in which people live. Although residents will enjoy private apartment spaces within a building or complex, they will share communal facilities such as media rooms with large movie screens or TV rooms. “The idea is that this environment helps combat isolation, loneliness and the general disconnection found in today’s society, particularly among the younger demographic,” said Witty.
Saleh Abdullah Lootah, CEO of Lootah Real Estate Development, believes that co-living projects provide an exciting opportunity for companies in the real estate sector to meet new demands and living trends. “It is a relatively new concept in Dubai, which is slowly attracting developers,” said Lootah. “On the other hand, we see growing demand from potential users such as co-workers, students and millennials who prefer shared spaces and use common facilities. This supports green building initiatives by reducing overall consumed utilities and cost of living.”
According to Nazish Khan, COO of Chinese brokerage Fidu Properties, all industries are paying more attention to the mid-market segment and affordable lifestyle. He believes that the rise of co-working spaces has paved the way for co-living projects in Dubai.
While the concept has yet to be tested in real living terms, it’s already proving popular with investors looking for small off-plan ticket prices, said Gaber Kenger, CEO of GN Homes. Altogether, Dubai has seen 902 transaction for co-living spaces, according to a July report by Property Finder.
“The idea of co-living will not affect the real estate landscape in Dubai,” noted Kenger. “The undersupplied, unique, more affordable studio-sized properties will, which is precisely what the co-living concept is about.”