Portugal coliving outlook 2021: Accelerating out of the crisis
Given the profound and dynamic nature of this global pandemic, Co-Liv and B-Hive Living have been convening a series of roundtables to explore the impact of Covid-19 and help coliving and other build-to-rent strategies pivot towards a sustainable future.
The main objective is to help the industry players gain a collective understanding of the wider impact of the pandemic, begin to consider the future market outlook and consider the best way to move forward. This blog post is written by B-Hive Co-founder and Co-Liv Portugal ambassador, Silvia Grattieri.
Context for the event
2020 was a year of damage limitation as we sought to anticipate and minimise the impact of the pandemic. 2021 will no doubt mark a turning point. Society has fundamentally shifted and it’s time to focus on rebuilding towards a different future.
This session looked at what to expect and the dynamics that will shape the coliving movement and real estate landscape in Portugal in 2021 and beyond.
Panel of Speakers:
- Matt Lesniak — Co-founder and Head of Impact & Innovation, Coliving Insights Magazine & Conscious Coliving
- Dave Williams — Chairman, CEO and Co-Founder, NOMADX
- Nuno Nunes — Head of Capital Markets, CBRE Portugal
- Williams Johnson — CEO — B-Hive Living (host)
Our top 10 coliving predictions for 2021:
- This pandemic will continue to trigger a host of new requirements for operators and tenants and with that a greater emphasis on safety, wellbeing and convenience will become the norm in 2021. As remote working becomes widespread, new coliving spaces will seek to provide larger private spaces with communal areas designed to cater for both living and working needs in equal measure as well as diverse levels of intimacy. Further investment and training in community facilitation will be required as mental health support and prevention becomes an essential skill in the coliving professional toolkit.
2. As this long spell of remote working continues, the perceived need for presence and proximity in the workplace is dissolving. Once travel restrictions ease, a new wave of remote workers, freelancers and digital nomads will be attracted to the Portuguese shores. The demand and supply for coliving spaces will shift towards residential neighbourhoods on the outskirts of Lisbon and Porto, as this new audience looks for an authentic Portuguese experience away from traditional tourist areas. The search for new retreat/work destinations is rising with locations such as Ericeira and Madeira Island likely to become hot spots for foreign workers.
3. Despite the mammoth influx of Airbnb properties in the traditional rental market in Porto and Lisbon in 2020, rental values are expected to remain stable in 2021 and even grow for premium coliving properties offering the right combination of comfort, services and amenities for the professional market. Highly desirable amenities include flexible contracts, no deposits, plenty of natural light, comfy chairs, large desks and of course high-speed internet.
4. Institutional investment in the coliving sector is set to grow in Portugal, after the show of strength and resilience demonstrated by coliving assets during the pandemic. According to CBRE, this growth will be marked by over 3,000 purpose-built units that are expected to enter the market in the next eighteen months. This strong pipeline is the result of a growing trend of collaboration between Portuguese investors, developers and international operators.
5. A renewed confidence in coliving, combined with the recent demise of Quarters coliving in the US, will lead to the introduction of management contracts which will replace lease contracts as the prevalent contractual form for large-scale coliving. In this pandemic, one of the lessons learned is that having lease contracts provides no guarantee of income for investors in tough market conditions, leading to costly and time-consuming contractual renegotiations. Hence, the recognition of the management model aligns the interests of both investors and operators in Portugal and elsewhere.
6. The old stock of large apartments in Lisbon will represent a substantial opportunity for coliving companies in 2021. The inflated prices of the capital have so far been a major hurdle for the proliferation of purpose-built coliving spaces and retrofit of those properties could become a way forward to unlock the power of coliving in Lisbon.
7. As banks and other more traditional forms of financing tighten, crowdfunding is set to become more prevalent to finance coliving projects, which enjoy a growing popularity among consumers generally. This has already occurred successfully in the UK and Brazil. 2021 could be the year that crowdfunding for real estate investments takes off in Portugal.
8. The real estate industry is the next in line to get its piece of the subscription economy cake. Economical and societal changes created an ideal condition for the new concept of subscription living. Offering flexibility and convenience to consumers, as well as a unique business opportunity for investors and shared living operators, living subscription models present themselves as a win-win model to please all stakeholders. Subscription living can establish a new paradigm for how people live, work, travel and connect. Businesses and investors in real estate need to prepare to take advantage of the subscription economy, otherwise they will have to witness the competition creatively fulfil the market needs.
9. With stress, anxiety and burnout on the rise, the homebuilding community will have a massive opportunity to shift their approach towards sustainability. The industry will need to go beyond the focus of the 1% equation associated with the costs of energy, water and waste, and truly embrace the transformative potential of healthy buildings that support the health and wellbeing of current and future generations. Environment certification and building design certification will become a must in the near future.
10. Integrating community wellbeing will be a paramount KPI. Operators will need to be proactive in designating programmes such as nutrition, fitness and sleep to empower residents to look after their resilience and lead a healthier work-life balance.
About B-Hive Living
B-Hive Living is a rapidly expanding UK born co-living developer and operator whose mission is to re-define shared living for a new generation: those who view renting as a lifestyle choice that allows for a more flexible, convenient and social way of living. We do that by building exceptional shared living spaces infused by a genuine sense of community, wellbeing and creative lifestyle supported by smart home technology for convenience.
Find out more about B-Hive Living.
Read the B-Hive Living blog.
With lots of co-love,
The Co-Liv Team
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