01 May The Kohab concept
Justin Shee is CEO & Founder of The Kohab, a co-living development business with a 21st century twist. He and his team have crafted a unique concept which promotes affordable living and also addresses issues of loneliness in elderly people.
The Kohab is undoubtedly a game-changing model and this bold and innovative approach certainly seems to provide a creative solution to modern day issues. Take a look at what Justin had to say about The Kohab in our Q&A:
Firstly, could you start by introducing The Kohab concept?
The Kohab is a new intergenerational living company, bringing old and young together to live in mutual support. Our model works by offering younger residents discounted rent in return for them supporting their older neighbours in our schemes. As operators, we manage quality urban developments and deliver above-market returns via our superior service offering. As a service, we are an answer to the age ghettos created by retirement living and a solution to the loneliness epidemic faced by both young and old adults.
What inspired you to start The Kohab?
Socially, I grew up living with my grandfather, which had a hugely positive impact on my life. I learned so much from it and he always said having my siblings and I around kept him ‘young’ and active. It was completely mutually beneficial.
Commercially, I was working in Alternative Investments at JLL and kept seeing that the big problem facing the retirement living market was that many potential customers do not want to live solely with other older people!
The Kohab seemed to be an obvious way to solve these issues, and it is based on successful European models that are becoming increasingly popular on the Continent and in America.
How does the product stand out and how do you think it will do in times of uncertainty?
The Kohab generates much wider market appeal than traditional retirement living schemes and appeals to the 87% who would prefer to live around people of mixed ages in retirement.
It also provides very defensive income: older people tend to make longer-term decisions, and hence will remain in the buildings we manage if the service is right. Also, their pension income and asset wealth is relatively well protected from economic shock.
How much is the product driven by the current market conditions?
The product is less driven by current market conditions and more driven by shifting demographics and changing consumer trends. People are living longer; healthier lives and they are no longer content to be confined in age ghettos in retirement. The market has not kept up to speed with changes in retiree consumer habits yet. We have responded to this with a co-living style service model within a real estate development that suits their needs.
What response have you had so far?
Hugely positive. We are working with a number of developers at the moment who have begun to build schemes which they are now looking to reposition to a Kohab style rental strategy due to the existing market. Whereas PRS yields are currently very low for residential schemes, we are able to work with developers to deliver much stronger yields by nature of our customer market attributing value to the right services which we can provide for them.
Why do you think creativity and innovation are important particularly in times when the market is not always certain or stable?
When we are in stable times, people get complacent and just roll with the status-quo. The real estate industry is generally a reactive, rather than a proactive industry. Uncertain times force people to be more creative and to really focus on what exactly it is that the customer wants, rather than just trotting out more of the same because that’s what they have always done!