Nathalie Palladitcheff from Ivanhoé, Youri Dauber and James Grasso from Cohabs with Cohabs NYC cohabitation spaces (Cohabs, LinkedIn, Twitter/@ydauber, Ivanhoé Cambridge)
A Belgian cohousing company receives a huge financial boost for its expansion plans in the United States and internationally.
Cohabs has lined up approximately $450 million in current and pledged funding from a group of backers that includes Ivanhoe Cambridge and a trio of Belgian investors. The startup’s other backers include AG Real Estate, Belfius Insurance and the real estate arm of the Belgian Sovereign Wealth Fund.
An initial tranche of €110 million, or approximately US$114 million, will cover Cohabs’ expansion plans over the next 18 months. If the colocation business can meet its expansion goals, an additional €300 million, or approximately $311 million, will be provided to see it through to the end of 2026.
About 70% of the $450 million Cohabs hopes to raise over the next four years will come from Ivanhoe, which has purchased a 35% stake in the startup. The remaining 30% will come from the company’s trio of Belgian investors.
Cohabs sought Canadian company Ivanhoé as a partner, citing the company’s knowledge of real estate investment, particularly in the United States, where Ivanhoe’s portfolio office, residential and industrial assets include properties in New York, Chicago, Los Angeles and Miami.
“We believe it was the right partner to help us deploy money and grow the platform in Europe and the United States,” said Cohabs CEO Youri Dauber.
“Cohabs offers everything we are looking for in terms of an innovative concept in an alternative asset class, which corresponds to a strong and growing trend in the housing sector, and we are confident that the company will continue to grow internationally,” Ivanhoe’s Arnaud Malbos said in a statement. statement.
Founded in 2016, Cohabs has around 1,550 rooms in New York, Brussels, Paris, Madrid and Luxembourg. While most of them are in Brussels, Cohabs owns and operates around 200 rooms across 10 houses in New York — seven in Brooklyn and three in Manhattan. Four of the startup’s locations in the city are open, with the others due to go live next year.
The company aims to have 5,000 rooms in 11 cities by the end of 2026. Chicago, Boston, Washington, London and Milan are among the cities targeted.
Cohabs New York’s plan is to buy one house per month, which would add 200 bedrooms per year over the next four years and bring its total to 1,000. The startup wants to eventually own and operate that number of bedrooms in each town.
The company forged ahead with a $50 million expansion in New York last year after closing a $70 million financing. Cohabs focused on acquiring small, underutilized and vacant buildings for use as cohousing properties.
Cohabs executive James Grasso spoke of the company’s potential in New York, citing rising apartment rents and more people working from home and looking to interact with others. A typical Cohabs room rents for $1,700 to $1,900, he said.
“I think the model has worked really well in New York because there’s an affordability component to living in shared housing,” Grasso said.
Dauber said the global co-living market was hot, citing higher utility bills and young professionals having more flexibility to travel. Projects with 10 to 20 rooms foster “a sense of belonging among members,” the CEO said. “[If we] focus on that, we think the market is huge.