Is This Co-Living's Unlikely West Midlands Liftoff Moment?

Being trapped in a flat with strangers for 12 weeks would be many people’s worst nightmare, so on the face of it the aftermath of three months of pandemic lockdown seems a particularly bad time to fund a co-living business.

Yet confidence in the build-to-rent variant is sufficiently high enough for Wolverhampton-based Studios24 to secure a £6.4M refinancing package with Cynergy Bank, and it could lead to more development backed by the North London-based investor.

The funding backs the transformation of the 12-storey former Carillion offices at Wolverhampton’s Birch Street into a £12.5M, 200-resident co-living scheme. The project recently reached practical completion.

The demographic at the Wolverhampton scheme is encouraging to investors, who see in co-living many of the strengths of the BTR sector. Of the current residents, only 10 are students and they are postgraduates. The rest are working in sectors such as healthcare, construction, education, human resources and technology.

Investors see long-term value in co-living schemes because the properties could easily be converted to other residential uses if the concept does not take root in the UK.

Co-living has made slow progress in the Midlands, with only the Wolverhampton scheme completed. The handful of proposals include Volume. Property's £16M plans for a 260-bed scheme at Hospital Street in Birmingham's Gun Quarter.

“To have secured a £6.4M loan from Cynergy Bank, while the UK is experiencing very difficult economic circumstances, is a major vote of confidence in our co-living concept,” Studios24 Managing Director Barry Glantz said. 

“We have been discussing the deal with Cynergy Bank over the course of the last six months and we have been able to strike a very good long-term deal. James Herron and Simon Gunnell, of Cynergy really believe in the project. They came to the development to see what we have created and liked what they saw. We believe this could be the first of many projects they may support, and they are keen to provide funding for our next venture. I am now actively looking for potential development sites across the West Midlands.”

The Studios24 provides residents with en-suite studios, arranged as apartments, with shared facilities including kitchens, working and relaxation areas, a café and bar, gym, laundry and high-speed internet.

Co-living is a form of housing that combines private living space with shared communal facilities and is designed to encourage communal interaction and build community. At The Studios24, residents have their own en-suite studios with shared kitchen and dining facilities. Rent includes energy bills, cleaning, council tax, superfast broadband, access to a gym, fitness studio, café and bar, and a range of social events for residents and guests.