The US’s largest co-living operator, Common, has raised $50m (£39m) from Swedish firm Kinnevik to drive expansion into build-to-rent and country growth.
Common launched in 2015 and revealed plans to expand to the UK at the end of 2019. In under a year, the platform has doubled its portfolio with 3,500 operational homes and 17,500 under construction.
The series D fundraising round launched in August, led by Kinnevik, which contributed the majority of capital. Other participants included Common’s existing backers Norwest Venture Partners, 8VC and Maveron as well as new investors Wilshire Lane Partners and VC firm Hanaco.
Common will use the finance to boost its platform, including growing its BTR offering, with new hires and new sites.
Kinnevik will also support Common’s expansion across Europe. The investment team is based in London and Common has appointed investment manager Akhil Chainwala to the board of directors.
Common founder and chief executive Brad Hargreaves told EG: “The biggest investment will be in our core platform, continuing to build out technology and improve quality, with more automation and more support for our members, as well as visibility of the building performance for owners.
“We are also going to be investing in expanding our real estate footprint.”
Common is currently in 26 cities and has been in talks on various opportunities in the UK for over a year. It is now expanding its target buildings to co-living and BTR, the latter under its Noah brand.
Hargreaves said: “The market has evolved and we have evolved too, particularly as we have expanded beyond co-living.”
However, he noted that growth in BTR faces greater competition. “We are not just competing with other co-living brands. We are competing with larger institutional managers, anyone who is doing third-party residential management.”
Its BTR strategy has been supercharged through a partnership with Nuveen Real Estate in the US, which it hopes to expand globally.
“We know they are keen in the UK and their real-estate arm is UK-based,” said Hargreaves. “Between Kinnevek and Nuveen I have a lot of reason to be in London.”
In the recovery from the pandemic, he is confident of continued demand for city centre living.
Common has responded in the short term by ramping up cleaning schedules and ensuring social distancing, it is also providing workspace and preparing for a future with a larger remote workforce and greater number of renters.
“I remain bullish on cities,” says Hargreaves. “I certainly think the need for affordability is going to continue to be there.
“There is still going to be a demand and a need for people who want to live in cities, near other people and with better experiences.”
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