The general needs for living solutions are changing along with flexible lifestyles and modern ways of working. Current spaces, leasing contract models and housing legislation are widely lagging behind these evolving mega trends. Coliving as a new and growing solution has emerged from real, user-centric needs, and is here to stay.

Especially younger people prioritise living in vibrant urban areas, seek avoiding long commutes and are willing to trade personal space for central locations. Coliving is especially feasible in large, urban areas with increasing population, a lot of commercial activity and lively microclimates. Apartment prices have a significant role in accelerating the trends towards rental models and away from ownership; the most desirable living surroundings for the target segment usually boast very high apartment prices, making owning your own flat very difficult.

Various coliving solutions are emerging in the Nordics, which has been a relatively undeveloped market for new and innovative living products. To answer the demand, NREP as a forerunner has its coliving concept Noli Studios, student housing platform UMEUS, coliving for elderly and families Plushusene and a flagship project UN17 Village in Copenhagen combining the ideas behind the different concepts.

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Site selection as a driver for the brand, length of stays and yield

“Location, location, location” – the age-old wisdom in real estate applies also for coliving concepts. As it is a cross-segment hybrid product, one needs to evaluate the selection of sites and project-specific commercial potential from several different perspectives. There’s local hotel and residential markets to consider: that is, the supply and demand now and in the future, distance to old and/or new city centres, site reachability with public transport as well as bicycle and walking accessibility. Other factors, such as the attractiveness and characteristics of the location microclimate and the perceived brand/attractiveness of any given area, should also be given attention.

Hotel locations can be categorised from ‘decent to central’, with specific TTD’s (time-to-destination) to the city centre and to the customer value-adding essential or preferred services. Living neighbourhoods on the other hand can range from steady to the most attractive locations that already have a strong and recognisable brand value. Ideal co-living locations combine both aspects.

There are additional factors affecting the attractiveness of a location that need to be considered as well: from transportation hubs in connection with shopping centres, via areas under accelerated (re)development for future brand potential, to areas with already established and recognised historical or current brand value.

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Case: Noli Sörnäinen – combining all the essentials

The second Noli Studios site, Noli Sörnäinen, comes close to checking every box for all of the major drivers for a successful and attractive coliving site. The immediate neighborhood is one of the most desired areas for young, urban citizens to live in, and on top of that, Noli Sörnäinen stands above the metro line just 6 minutes away from the city centre. A booming microclimate with restaurants and cafes brings a lot of value to daily life in the area.

The building has a great coliving layout as the vast majority of the common spaces are located in the second floor above ground level. Views to the busy street level while playing pool, working from the lounge or cooking dinner in the common kitchen creates a unique feel and sense of community at the site. Lively microclimate, densely populated surroundings and one of the best public transport connections throughout the Helsinki Metropolitan Area make Sörnäinen a great location for hotel demand as well.

The stronger the location, brand and surrounding microclimate, the stronger the hotel short-stay upside is. Unfortunately the situation is not all song and dance, as the hotel product and business are considerably more risky and resource-intense than compared to a traditional residential product – this needs to be taken into account in development yields. The same goes also for mid-stays, when adjusted accordingly.

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How we design our spaces: a coliving product needs to be functional, practical and provide comfortable home-like surroundings

Functionality stands for solutions that are clever, efficient and address specific customer needs, without forgetting high-quality materials. Practicality stands for efficiency in operations, unobtrusive maintenance and justification for different solutions. In addition to a careful, timeless and fresh visual look, homelike surroundings mean that the spaces are not extravagant, but calm, relaxed and inviting.

Functionality, practicality and homeliness can not only be achieved by increased expenditure; they must also be achieved with good design. It is essential to understand the most important factors in adding value to users, and really focus on delivering those. The product layers of visible user interface and straightforward operations also play an extremely important role.

The building massing – shape and architectural aspects – mean a lot for a wide audience. In order to build an optimal value-adding coliving product, the building and its interior spaces must project a brand-compatible positive image, have thought- through design solutions and provide a comfortable stay for our customers – all the while being affordable.

All areas need to be designed and realised according to the specific characteristics of the different space types – from technical and operational spaces to centrally located communal areas that bring that little something extra in the form of buzz and cool. The coliving building must serve the needs of its users, but also enable easy logistical access and day-to-day operations. Smart placement and bundling of different space types generates spatial and operational efficiency.

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The benefits of an integrated model: implement changes from daily operations directly to product design

Traditionally in real estate development projects, there has been a vast number of stakeholders with different roles and varying needs that had to be consolidated. In a somewhat laggard industry, this has created a clear demand for new kinds of integrated project delivery models that target increased collaboration, holistic design and realisation solutions as well as more comprehensive overall risk-reward management.

There’s a new Integrated Project Delivery (IPD) wave sweeping the construction and real estate segment which merits a closer look. IPD is a contractual and organisational setup which emphasises common stakeholder responsibility – sharing of risk and benefits. The idea is to create a common project organisation between different parties to work towards common goals for the best of the project and capitalise on the wider know-how, without traditional organisational boundaries acting as obstacles. For further reading on IPD and other lean project methods, there’s an abundance of scientific and case studies available, and you can refer to the Lean Construction Institute archives for more insights.

Focusing just on one large organisation - for example, real estate developers - there’s also multiple internal (in-house or partnership) processes that need to work together efficiently for maximal value creation, from the initial investment to operations and asset management, and everything in between. Integration of work methods, setting up of collaboration platforms, experimenting in co-creation as well as introducing common reflection on positives and issues that could be improved, will bring tangible benefits and an advantage on the market – faster than one could imagine. The tools and platforms used can be physical or virtual – the underlying principle of co-creation in target-setting and delivery is what matters. Thus primarily, the setup demands a shift in attitude, then of course a strong operating and governance structure as well as process and project management skills – but as an upside the integrated model keeps the value generated close by, and provides a magnificent platform for continuous improvement.