Berlin-based co-living service provider Medici Living Group and Frankfurt Stock Exchange-listed real estate investment manager Corestate Capital Holding have entered into Europe-wide cooperation whose aim is to invest €1 billion of equity and debt in the co-living sector over the next three to five years. The companies will cooperate on the acquisition, development and management of co-living projects located in Germany, the UK, the Netherlands, Austria, Switzerland, Spain and Poland.
The partners will focus on cities with more than 500,000 inhabitants and on existing and new properties requiring an investment of between €20 million and €60 million. They expect that the investment program will include approximately 35 assets in total, which the Medici Living Group will operate under the Quarters brand. The program – which represents one of the biggest investments in the co-living sector to date – will allow the group to add around 6,000 rooms to its portfolio.
“This investment is the breakthrough for co-living in Europe,” argued Medici Living founder and CEO Gunther Schmidt. In his opinion, the new asset class has even bigger potential than the already thriving co-working sector. “The residential market is significantly larger than that for office assets. We want to become the WeWork of co-living,” Schmidt said. Michael Bütter, the CEO of Corestate, added that investment in the co-living sector is defined by the low risk profile of residential property which, however, is paired by higher yield expectations.