CHENNAI: With social distancing norms set to continue for the foreseeable future, co-living spaces are facing the heat and may have to reinvent themselves to find takers.
Ajit Chordia, former president of Confederation of Real Estate Development Authority of India and managing director of Olympia Group, feels there will still be a demand for high-end co-living spaces.
"Those in hostels and dormitories may suffer as migrant workers have left. Now, quality is going to be critical and so is hygiene and cleanliness," says Chordia.
Dr Nikhil Sikri, co-founder and CEO of Zolo, told The New Indian Express that co-living spaces have been hit by the lockdown. "The low-end market may struggle to survive post-lockdown as they have to maintain necessary hygiene and social distancing," he says, adding that larger players could survive.
Interestingly, the lockdown did not impact Zolo's plans to invest Rs 200 crore in co-living spaces across India. "Of the 200 crore, we are investing Rs 50 crore to Rs 70 crore in Chennai," says Sikri.
Valued at more than $100 million, Zolo is now India’s fastest moving technology startup in the co-living space sector. "With the aim of providing a completely hassle-free long term living experience to working professionals as well as students, our living spaces offer all kinds of basic and luxury living amenities," says Sikri.
However, bigger players in the co-living space sector like Sikri hope that people will be ready to pay more to ensure they are safe from COVID-19. "Usually people were shy of paying Rs 1,000 or Rs 2,000 more and would prefer PG accomodation," says Sikri, who charges Rs 8,000 per month for a person. "It could be twin sharing or single room with separate bathrooms," he says.
Most of the mansions, dormitories and other co-living spaces cater to students and officegoers but with colleges taking time to open, it may hurt co-living space owners. "The impact is there but we are catering to only 10 per cent college students," says Sikri.
S Sridharan, Chairman CREDAI, TN chapter, says that with colleges and offices functioning with minimal workforce, a clearer picture will emerge only after the lockdown.
Many co-living space owners say there is still a demand for mansions and dormitories as the lockdown is being eased and people are coming back to work. But then without students and with companies working at 50 per cent capacity, there aren't many takers now.
A Shankar, Chief Operating Officer, Strategic Consulting, Jones Lang LaSalle (JLL), says that co-living spaces can't be written off easily although they have to follow the social distancing norms.
While the lockdown may have hit co-living spaces, it was a temporary setback, he said. "Even the low-end market like the PG accomodation or mansions will have to adhere to social distancing norms to survive. The mantra will be cleanliness and hygiene," says Shankar, adding that now is the time for these establishments to reposition themselves.
Meanwhile, there is still hope. Sikri says that around 800 people have shown interest in their Chennai properties and will move in once the lockdown is eased further in the city.