Residential Real Estate News
Korea's Co-Living Market Heats Up in 2025
Interest grows from both domestic and foreign capital
Despite a nationwide increase in single-person households, a new report from global real estate services firm JLL suggests that co-living is not just a niche accommodation choice but a growing residential trend in South Korea's evolving housing market.
According to JLL's latest research, co-living arrangements are becoming increasingly attractive to young professionals, college students, and international students. These demographic groups often face limited access to dormitories or affordable housing, making co-living an appealing alternative that blends private living quarters with shared amenities like kitchens, coworking areas, gyms, and libraries.
"With the growth of the corporate rental housing market, competition among co-living operators will only intensify, as will investor interest," said Veronica Shim, Head of Research at JLL Korea. "Large conglomerate affiliates and coworking startups are entering the space, indicating the solid potential of this emerging asset class."
Data from JLL shows that as of May 2025, the median size of units in Seoul's co-living properties that are under 40 square meters is approximately 23 square meters. These compact living spaces offer flexible configurations, allowing tenants to select their level of communal space usage based on cost, balancing affordability with community and independence.
The premium attached to co-living is evident in rental prices. The average monthly rent for a sub-40sqm co-living unit in Seoul stands at 1.13 million won--about 1.5 times higher than the average officetel, Korea's hybrid residential-commercial studio apartment. In the highly sought-after southeastern districts, including Gangnam, rents can reach up to 1.7 million won per month.
The institutional investment landscape has also evolved. Since IGIS Asset Management launched a KRW 250 billion blind co-living fund in partnership with MGRV in 2020, the sector has seen a surge in joint ventures between asset managers and co-living operators. SK D&D, for example, is merging with LocalStitch to roll out the 'Episode Conveni' co-living brand, and global investors like GIC, Hines, and Warburg Pincus have entered the market with increasing conviction.
Notable 2024 transactions include Morgan Stanley and Gravity Asset Management acquiring and transforming an unsold officetel in Gangdong-gu into rental housing, which SLP now operates under the brand 'Gwell Homes Life Gangdong'. The trend of repurposing underused hotels and officetels into co-living spaces is gaining momentum.
JLL's Shim notes that government support and the expansion of REITs are expected to further bolster the sector. "The shift toward monthly rental agreements and the rise in single-person households are driving demand for rental housing. We anticipate more conversions of unsold officetels into rental projects as investor activity accelerates."
IGIS Residence REITs remains the only publicly listed REIT focused exclusively on rental housing portfolios. Meanwhile, Koramco Asset Trust is planning new co-living developments, and Union Place is advancing efforts to launch a dedicated co-living REIT. As public-private initiatives to revitalize long-term rental housing increase, the volume of institutional investment is expected to rise accordingly.
The co-living trend, once viewed as a fringe housing solution, is fast becoming a cornerstone of Korea's rental housing ecosystem--fueled by demographic shifts, evolving lifestyle preferences, and robust investor confidence.
