In an exclusive interview, Anindya Dutta of Stanza Living shares his views on the impact of COVID-19 on the co-living space in India, and how do they expect the segment and their business to evolve post the pandemic.
The pandemic has created greater acceptance of the value of our managed accommodation operations from educational institutes as well as corporates.
The impact of the pandemic has been more pronounced on the larger rental accommodation industry than the managed accommodation segment. There’s been a significant shift in consumer preferences for branded, high-quality accommodation over traditional, local rental housing options, as the consumers today are prioritizing safety and hygiene much more than has ever been the case, says Anindya Dutta, Managing Director and Co-Founder, Stanza Living.
In an exclusive interview with Sanjeev Sinha, he shares his views on the impact of COVID-19 on the co-living space in India, and how do they expect the segment and their business to evolve post the pandemic. Excerpts:
How has COVID-19 impacted the co-living space in India? How have you weathered the challenges?
The impact of COVID-19 has been more pronounced on the larger rental accommodation industry than the managed accommodation segment. There’s been a significant shift in consumer preferences for branded, high-quality accommodation over traditional, local rental housing options, as the consumers today are prioritizing safety and hygiene much more than has ever been the case. So, while there was a pronounced dip in occupancy levels due to the pandemic in the short term, we are now witnessing early signs of an unprecedented rebound in demand from various quarters.
We leveraged the lockdown period of the pandemic to drive further efficiencies in our business model and introduce several best practices and are today very well poised to shape a faster recovery path.
Our promptness in establishing benchmark hygiene and health practices have also assured our consumers that we prioritize their safety and health. We are already seeing high interest in contract renewals from residents who continue to stay with us, as well as high pre-booking queries from new consumers.
As there seems to be light at the end of the tunnel now, do you feel there is recovery in sight? If yes, from what corners are you expecting it?
Yes, indeed. With economic activity resuming, there has been a robust revival in demand enquiries to before pandemic levels from residents planning to return to their Stanza Living residences. There has also been a 6X jump month-on-month in inbound queries and pre-bookings from new consumers who recognize the value of our high-quality managed accommodation offering and the credible brand experience we have built nationally. We’ve been proactively engaging with all our consumers on the host of measures that we have already adopted to provide them an even more seamless and safer living experience, than before.
The pandemic has also created greater acceptance of the value of our managed accommodation operations from educational institutes as well as corporates. Educational institutes find themselves under pressure as accommodation options are being vetted on how pandemic-prepared they are. Considering our agility in adopting COVID-combat precautions and protocols, proven record of driving professional and efficient operations, and delivering better returns on hostel management, we have become the partner of choice for several institutions. The crisis has accelerated our conversations with educational institutes and driven a 10X increase in collaboration requests for both on-campus facility management and off-campus capacity support.
Furthermore, with offices reopening in hybrid capacity, businesses are for the first time perhaps concerned about the quality, safety and health of their migrant employees’ living arrangements, and its role in mitigating infection exposure. At the same time, with homes doubling up as offices, a stable, convenient and productive work from home environment is the expectation. We are working with several IT companies, startups and other businesses to become their preferred accommodation partner, providing high quality, fully managed accommodation solutions to employees.
How do you expect the segment and your business to evolve post the pandemic? Have you made any strategic business shifts in this direction?
Even before the pandemic, managed accommodation operators like us had already created huge value and credibility among consumers due to our adaptable, consumer-focused offerings. Now, more than ever, the idea of what a living space should mean is being reimagined – it must be an all-inclusive, reliable and safe living environment, a convenient work from home/study from home space and a place for relaxation, leisure and entertainment. At Stanza Living, we have agilely adapted to these needs, and technology has been at the forefront of driving this evolution in product and delivery experience. For an essentially physical business like ours, the building of an even more deep-rooted technology ecosystem that is helping us scale efficiency, reduce costs while amplifying consumer experience, has been a key strategic development during this period.
We’ve also been utilizing this time to fine tune and strengthen a few business verticals, focused on greater value addition to consumers through our service offerings. We have some very exciting announcements in the pipeline regarding these which will be shared very soon.
We believe, professionally-managed accommodation will be the preferred choice of living among the young population – guided by factors like cost (budget-friendly), convenience (wide-range of amenities and services delivered reliably) and access (limited supply of high-quality, secure and hygienic accommodation options). We expect the sector to soon resume, and also better, the trajectory of growth it was clocking before the pandemic.
What are your business plans for the future? Will you continue to look at market expansion etc.? Anything new that you are planning?
Apart from building and consolidating our leadership position in our existing markets, we’ve unlocked inventory in new Tier I markets like Chennai and Ahmedabad and large Tier 2 markets like Vishakhapatnam and Nagpur which have become new centres of growth. We’ve entered these cities on the back of strong market demand and are already recording pre-bookings from there.
We plan to continue to drive business growth through organic and inorganic means. Case in point is our recently-announced acquisition of Yourshell, a hyperlocal student housing business based in Delhi, further consolidating our footprint in the national capital.