Co-Living Sector in India Attracts $980 Million in Funding Over a Decade: Colliers

Surge in Demand from Students and Young Professionals Drives Investor Confidence​

New Delhi, May 12 – India’s co-living sector has witnessed a substantial influx of capital, with operators raising a total of USD 980 million over the past 10 years, according to real estate consultancy Colliers India. The sharp rise in demand for managed rental accommodation, especially among students and young professionals, is fueling this growth.

In its latest report, Colliers India highlighted that the co-living market is undergoing a new phase of expansion, marked by increased investor interest and aggressive scaling plans by leading operators across Tier I and select Tier II cities.

“India’s co-living sector is entering a new phase of growth, underpinned by strong demographic fundamentals and a growing preference for flexible, community-centric living,” said Badal Yagnik, CEO of Colliers India.

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Organized Market Reaches 3 Lakh Beds​

Colliers estimates that the organized co-living market currently offers around 3 lakh beds, catering to the rising urban migration driven by education and employment opportunities. Operators are actively raising capital to expand their footprint, capitalizing on the post-pandemic rebound in demand.

According to the report, the sector raised USD 205 million in 2018, followed by USD 220 million in 2019. Despite pandemic-related disruptions, USD 142.1 million was secured in 2021, reflecting consistent investor confidence.

Attractive Returns for Institutional Investors​

Institutional investors are increasingly viewing co-living as a viable asset class, offering returns close to 10%. This is significantly higher than the 2–5% yield typical of traditional residential assets, making co-living a lucrative option in the real estate investment landscape.

“Following a temporary lull during the pandemic, the demand for co-living is regaining momentum, driven by the inherent strengths of the sector,” Colliers noted.

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Demographic Shifts and Urban Preferences Fuel Growth​

Key factors driving sustained demand include:

• Urban migration linked to education and employment
• Rising disposable incomes
• Preference for fully managed rental accommodations
• An increasing inclination toward community-based, flexible living arrangements

The USD 980 million funding includes investments across multiple stages and through diverse financial instruments such as equity, debt, mezzanine debt, and private placements, Colliers added.

With strong demographic trends and a favorable investment environment, India's co-living sector appears poised for continued long-term growth.