Malaysia's co-living sector is expected to come out stronger from the Covid-19 disruption, Knight Frank says.

Shared living spaces, which are especially popular among millennials and Generation Z, had previously been gaining traction in cities such as Kuala Lumpur, where it offered agile, urban lifestyle living with no mortgage stress. 

Knight Frank Malaysia Executive Director of Capital Markets, James Buckley, said while Covid-19 had made it difficult for co-living to prosper, the concept was likely to rebound strongly.

At a glance: 

• The recent Commercial Real Estate Investment Sentiment Survey 2020 (CREISS 2020) report reveals that 58% of the respondents are exploring or planning to develop co-living / student accommodation.
• As Kuala Lumpur has become more expensive, co-living addresses some of the issues around living in the centre of the city.
• Knight Frank Malaysia has predicted growth for the sector when Covid-19 subsides.

“Many singles, students or young professional workers find conventional new apartments out of their reach because of high rents, deposits and furnishing costs and co-living can be a more attractive option," he said.

“However, due to the COVID-19 pandemic and until a vaccine is developed, co-living occupancy rates will be impacted as social distancing is very difficult when you are sharing a home with others, some of whom may be complete strangers or transient renters. 

Source: Knight Frank 

This drop in occupancy is likely to be short-lived and once the COVID-19 crisis subsides, we believe there will be growing interest in this sector." 

Knight Frank Malaysia Executive Director of Research and Consultancy, Judy Ong said the pandemic may cause developers who are exploring or planning to develop co-living accommodation to revisit the functionality of their co-living space in regards to the communal areas and shared facilities.

“The requirement for human interaction remains deeply rooted although the new normal beyond the COVID-19 crisis is hard to predict,” she said.

“With the safety and health of residents being high on the priority list of operators, hygiene of communal spaces is of utmost importance at all times.

“With right timing post-COVID-19, co-living presents an opportunity for key players to secure a first-mover advantage in this largely untapped market.”

Click here to download a copy of the report.

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