Dear WuBookers, with the spread of phenomena such as smart working and digital nomadism, the tourism and real estate sectors are increasingly intertwined and solutions halfway between the two often arise. This is what happens with co-living, living spaces that combine residential and working dimensions with some typical hotel features.

And which can offer an interesting investment opportunity for hoteliers and operators in the sector: let’s see what they are.

What co-living is and how it works

The word co-living is quite recent and denotes a hybrid facility between a hotel and a rental apartment. Within co-livings, in fact, guests have private rooms and shared spaces such as kitchen, bathroom facilities, laundry, and living room. To these can be added extra services such as housekeeping, access to in-house spa and restaurant, social activities and events organized by the operator.

Difference between co-living and hotels

Although there is no single model of co-living (they range from entire buildings to the floor of a skyscraper), there are some traits they all share:

• the affordability compared to other long-term housing solutions;
• a configuration of space that is more flexible than a hotel;
• the centrality of location, especially within urban settings;
• the presence of a community to live and work with.
  

Unlike hotels and hostels, these facilities offer coworking areas: environments equipped with all the amenities (workstations, wi-fi, refreshment point, and so on) that facilitate remote work and the exchange of ideas among professionals.

It is precisely young single professionals who are the main target of co-living: also attracted by the opportunity to work and socialize, they choose living solutions that are more affordable than a regular rental and more versatile than a traditional hotel.

Why guests choose co-housing

As we have seen, co-living does not replace classic hotel or real estate offerings, but it is a viable alternative to both, especially for a certain segment of the public. Guests can count on homes and apartments in central areas, often unattainable for market prices, organized according to their professional and social needs.

Not only that, sharing accommodation with others reduces household waste and encourages ecologically virtuous behaviors, an increasingly important and sought-after aspect for customers in the tourism industry in general.

The benefits for sector operators

Even at an urban level, co-housing is an incentive for environmental sustainability, especially when it is created in existing buildings redeveloped for this purpose.
This is also a viable option for those who already operate an accommodation facility. Aside from the regulations and bureaucratic procedures specific to each country, modifying the layout of a hotel to transform it into a co-living space can bring numerous advantages.

The first concerns a greater continuity of occupancy, for longer and more frequent periods, even during the low season, with regular cash flows.  

Rates – which are subsidized compared to those of a regular hotel room – can still be increased by including extra services over the basic plan, such as all-inclusive packages that include bills, cleaning and maintenance.

Longer stays also mean reduced staffing, easier management and lower expenses. All factors that make this new trend quite attractive.

Be careful not to underestimate some important details, however.

Things to consider before opening a co-living

As we have seen, it is important to consider the context in which coliving is inserted. This type of accommodation attracts mostly students and freelancers, so it is more effective in university or business cities where traditional housing solutions are not sufficient or affordable.

In this regard, it is essential to take into account the needs of the guests in terms of the pricing and the overall project. The property’s layout must respect both the criteria of privacy and conviviality. Designing comfortable and inclusive living and working spaces is an essential requirement for the success of the operation.

When it comes to efficiency, valuable help can come from technology. Increasingly integrated into people’s everyday domestic and professional lives, it can provide practical operational support (think, for example, of domotics), facilitate connection between people (why not create a dedicated app for those staying in co-living?) and thus improve the overall guest experience.

In terms of management, it’s always a good idea to use software designed for the sector, such as Zak, the PMS for hotels and co-living facilities from WuBook.

The future of co-living

Co-living emerged as a response to current phenomena and needs, mainly related to new and flexible ways of living and working. It is difficult to predict exactly how it will evolve in the future: much will also depend on how situations such as emergency housing and over-tourism will be handled – at a local institutional level.

On the other hand, it is true that this type of solution lends itself to numerous declinations, such as co-housing, and meets several criteria dear to an important segment of travelers, such as environmental and economic sustainability.

There is no shortage of experimentation, in Europe and around the world, with facilities and chains present from Hong Kong to London, from Berlin to Milan.

If you are thinking of opening a co-living hotel, we recommend starting with these examples to identify the model best suited to your context and specific market demand.