Dive Brief:
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Rents at WeWork’s Wall Street co-living space in New York are expected to jump sharply next year as the company seeks to reflect current market rates in the city’s Financial District, following a period of beta pricing after opening in April as the WeLive brand, according to documents obtained by The Real Deal.
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The rent increase will see a studio apartment go from $2,000 per month currently to a new rate of $3,050, while 4-bedroom units will rise from around $6,000 to $8,000.
- Fully furnished, the dormitory-style apartments include shared amenities like a movie theater, yoga studio, kitchen and networking events, in addition to unlimited coffee, tea and beer. It is co-located with a WeWork co-working space (shown above). The company’s other WeLive space is in the Washington, DC, suburb of Arlington, VA. It has 138 co-working spaces in 34 cities worldwide.
Dive Insight:
WeLive's rent hike comes as New York and other major U.S. cities face a deepening shortage of housing and higher costs for that stock as a strengthening job market draws new residents there.
The appetite for affordable homes is particularly strong in cities like New York, but the expected move by WeLive to raise rents also underlines the demand for higher-end developments, particularly ones with other amenities like co-live/work spaces.
Such growth in the market is also helping developers secure the loans required to get high-priced, amenity-rich projects off the ground, despite tight lending conditions.
Real estate group GID and its partner Henley Holding Co recently bagged $1.24 billion in construction loans to fund its luxury 1,132-unit development of Waterline Square on Manhattan's Upper West Side in New York, while Chicago-based developer Related Midwest secured a $240 million construction loan to finance its One Bennett Park luxury residential tower in Chicago’s Streeterville neighborhood.
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