UK/US: Coliving developer and operator The Collective says short-term stays have been severely impacted by the lockdown but its long-stay business is proving resilient.
An update from one of its lenders, GCP Asset Backed Income Fund, said The Collective was in advanced negotiations to let one of its short-stay buildings for key workers and was considering reallocating short-stay rooms for long-stay use.
The Collective’s global corporate affairs director James Penfold said: “We are in the early stages of exploring a range of options for various assets in our portfolio, including a partnership with the New York City Department of Health and Mental Hygiene to repurpose The Collective Paper Factory to support short- to long-term patients who do not have a safe and secure place in which to self-isolate. In the UK, we are housing NHS staff and vital key workers across our portfolio, and are exploring the opportunity to allow them to stay for longer periods in those buildings and across our portfolio.”
Penfold added that the company’s long-stay business was proving “very robust”. “The community aspects of coliving while maintaining social distancing are a real positive for our residents at this time of isolation,” he said.
GCP partnered with Deutsche Bank on a £140 million refinancing of The Collective’s portfolio in February. It said the deal put The Collective in a “strong cash position with the ability to weather the drop in occupancy”. However, it increased the discount rate applied to the loan investment by 150 basis points to reflect the risks posed by the Covid-19 outbreak.
