In an age where COVID-19 has created new ways to work, live and travel, an increasing number of existing hotels have been transforming into co-living spaces. While hotels stand to benefit from higher rental growth potential and favorable tax rates in several cities, for travelers and global nomads these spaces foster communal living and face-to-face connections with like-minded people.
Singapore, along with Hong Kong, has seen a sharp increase in co-living spaces. Lower tax rates on the purchase of hospitality assets compared to residential assets, which are subject to higher transaction taxes that decrease investment returns, have made hotels the best option for asset conversions. Losses incurred by underperforming hotels during the pandemic, coupled with a steep rise in residential rents have also helped co-living spaces rise in popularity.
In response to this emerging trend, Singapore-based CapitaLand Investment Ltd.’s lodging company, The Ascott Ltd., launched lyf (‘live your freedom’), a hybrid lodging solution and co-living brand designed for next-generation travelers.
lyf combines serviced residences, hotels and co-living apartments and is designed for guests on long-stay, with the flexibility to opt for shorter stays. Since the brand opened its first property, lyf Funan Singapore, in 2019, it has grown to 19 properties with over 3,600 units across nine countries and 16 cities. This includes 11 properties currently under development. Properties are slated to open in Beijing, Cebu, Danang, Ho Chi Minh City, Manila, Paris and Sydney by 2025.
After the success of its inaugural venture in Singapore, lyf aims to widen its global footprint and sign 150 more properties with more than 30,000 units by 2030.
“The pandemic spurred a new way to live and work. The lyf brand showcases its innovative and curated experiential programs, well-designed co-living spaces and digital offerings and how we provide opportunities for social interactions with neighbors at doorstep, engaging next-generation guests who travel for business and leisure,” said Norman Cross, head of lyf brand.
As a digitally enabled co-living concept, the brand has resonated well among guests and partners globally with new signings and property openings on track despite the pandemic. With Ascott’s 1H 2022 revenue increasing by 45%, most of the contributions were attributed to higher revenue from its expanded portfolio of longer-stay assets comprising rental housing properties and student accommodations.
Three of the brand’s properties in Singapore — lyf Funan, lyf one-north (which opened in 2021) and the new lyf Farrer Park (opened in March 2022) have maintained strong occupancy throughout the pandemic, leveraging on Ascott’s robust base of corporate guests on extended stays.
“With the easing of international travel restrictions, we have also seen an increase in demand for our co-living apartments in Singapore from both corporate and leisure guests. Occupancy at the three lyf properties is averaging at more than 85%,” Cross said.
As lyf strengthens its presence across Singapore, the brand is also preparing to open in gateway cities of Bangkok, Thailand; Kuala Lumpur, Malaysia; and Xi’an, China. The latest lyf property to open this year was in Australia, the brand’s first in the continent‚ lyf Collingwood Melbourne.
In addition to the expanding lyf brand management contracts, Cross says there are attractive opportunities to invest in the product class. Ascott recently announced the acquisition of its first lyf-branded property in Tokyo through the Ascott Serviced Residence Global Fund, Ascott’s private equity fund with Qatar Investment Authority.
The property will be refurbished to debut lyf in Tokyo and is scheduled to open in June 2023 as lyf Ginza Tokyo. Ascott also acquired the first lyf property in Sydney, lyf Bondi Junction Sydney, through the global fund.
Expanding the experience
Besides fostering communal living, lyf also curates experiential programs and offerings to encourage social interactions. Through #lyfgoeslocal, guests can plug into the community and experience local culture through programs and events. It includes partnerships with other businesses in the neighborhoods or events to help connect guests with local businesses, entrepreneurs, art, fashion and music.
With the #lyfxart initiative, guests will be surrounded by artworks created by local and overseas artists, specially curated to reflect the property’s location, culture and heritage.
lyf has also partnered with Temasek Polytechnic’s School of Informatics & IT for the lyf Innovation Lab, which powers Ascott’s digital-enabled offerings. The lab will explore, design and testbed immersive virtual reality and augmented reality technologies, as well as digital experiences for the brand. lyf one-north Singapore serves as a living lab for field testing these digital innovations. The successful pilots will eventually be implemented across other lyf properties.
“The lyf brand has always been advocating new ways of living and forming communities,” Cross added. “The partnership will enhance our lyf community building efforts beyond the walls of our apartments to offer borderless experiences in the virtual realm, allowing guests to explore, engage and interact with lyf and one another like never before.”