Dubai: ‘Co-living’ options in Dubai are once again seeking higher visibility with tenants after a tough initiation in the immediate aftermath of the Covid phase.
As landlords turn favourable, the city will see more co-living accommodation being offered and at a time when potential tenants – especially among the younger set – are scouting for less expensive accommodation.
“With alternative work styles such as remote and flexible work accelerated by the pandemic, young professionals around the world are no longer bound to live near the office,” said Bass Ackerman, founder of Hive JVC. “As such, they are choosing to live and work from remote destinations.
“Dubai is becoming increasingly popular in this regard with top regional and international talent choosing to migrate.”
Ackerman and the Hive have been pioneers in the city on the c-living front. But there was a time in 2020-21, when it was felt that ‘co-‘ options whether living or working would suffer because of the pandemic, with people unwilling to share their spaces with relative strangers.
Ackerman accepts that times were tough. “It’s undeniable that COVID-19 impacted overall rents and occupancy rates across the co-living asset class,” he added. “It’s interesting however that Cushman & Wakefield noted that in North America - one of the largest co-living markets – co-living rents and occupancy have declined in line with those in conventional Class A urban asset rents.
“For us specifically, we were fortunate that our first co-living asset, Hive JVC, only opened in January 2022 at which point the effects of the pandemic had started to wane. We have seen extremely strong demand for our product. I’d go as far as to say that if anything, the pandemic has increased the popularity of co-living as an asset class because of its key value propositions - i.e., flexibility, convenience, strong amenities and a more social and interactive living environment which is in high demand among the younger and increasingly transient generations.”
Rules too are turning favourable
It will help designated co-living projects, existing and new, that Dubai has become extremely strict with non-sanctioned shared accommodation. These days, details need to be provided of the number of people living in a rented property, part of wider moves to curb sub-leasing or any such activity.
Regulations ‘help’
According to Ackerman, “Co-living assets along with short-term rental options such as holiday homes have benefitted from increasing regulatory pressure placed on co-occupation as it has effectively reduced the supply of flexible, furnished living solutions.”
All these will help push the message of co-living options among its intended user base. Market sources say that developers/landlords are considering creating dedicated co-living options in new communities. According to a developer source, “If we are creating co-working space in our projects, it then makes sense to build co-living capacity too. The resident profile of the city keeps changing – and 2022 recorded some drastic ones.”
Ackerman agrees: “With alternative work styles accelerated by the pandemic, the concepts of the office-and-home are blending. Properties, such as Hive JVC, which have a hybrid approach with flexible living and working solutions within the same property, make a compelling offering for end-users. and generate a healthy rental premium, which is ultimately reflected in a higher yield for asset owners.”
Other landlords in Dubai are starting to get the same idea.
