Ernee Ong and Jelene Sim, co-founders of Bespoke Habitat (Picture: Bespoke Habitat)
SINGAPORE (EDGEPROP) - When co-living operator Bespoke Habitat started operations in September 2019, co-founders Ernee Ong and Jelene Sim did not have much experience running such a business. “At that time, we didn’t know how to do a lot of things and there were a lot of hiccups,” Ong recounts. The married couple had left careers in sales to pursue their ambition of starting a co-living platform.
Read also: Co-living player Bespoke Habitat raises $1 mil for expansion
The idea for the business came from their shared love of investing in property — an endeavour the couple had pursued over the years, using income saved up from their jobs. After gaining experience investing in property across multiple asset classes, including residential, industrial and commercial properties, Ong says the pair shifted their gaze towards co-living. “We wanted to enter into the space because we felt we could scale up more easily compared to other types of properties,” he says.
The couple started reaching out to property agents, offering services to manage rental properties on behalf of homeowners. Gradually, their portfolio started to grow, which Ong attributes as a testament to the value-add of their services, which include touching up and prepping properties for listing, onboarding and managing tenants, and providing maintenance and cleaning services.
In January, the company announced it had raised $1 million in funding from angel investors, further spurring expansion. Today, Bespoke Habitat manages about 850 rooms, totalling some 200,000 sq ft.
Similar to many other co-living operators in Singapore, the majority of Bespoke Habitat’s tenants consist of foreign clientele, representing over 90% of its user base. However, Ong notes that Bespoke Habitat targets a specific segment, which he describes as “mass working executives”. A typical persona within this segment includes employee pass holders earning a monthly income ranging from $4,500 to $7,000.
Ong highlights that workers within this category are often looking for rental properties within a specific budget, which he gauges at roughly up to $1,500 per month. Renters with this profile typically rent a room and are willing to stay in non-central areas which offer cheaper rents, he adds.
To that extent, Bespoke Habitat aims to cater to this segment, with the majority of its properties comprising rooms located outside the city centre. “We are very focused on areas in non-core regions,” Ong affirms. The company currently has properties across condominiums in various areas including Jurong, Simei and Tampines.
In addition to working executives, Ong says that roughly 20% of their renters are foreign students including those from the Nanyang Technological University and National University of Singapore in the west, as well as the Singapore University of Technology & Design in the east.
Focusing on these profiles of renters has allowed Bespoke Habitat to be “pandemic-proof” and insulated against economic turbulence, says Ong. Even at the height of the pandemic, when borders were closed, the company was able to continue to expand, with its occupancy rates remaining over 90%. Today, Ong shares that occupancy is nearly maxed out at 99%. Tenants come from countries including India, China, Vietnam, Indonesia and Myanmar, among others.
Ong observes that demand for properties in non-central locations has also accelerated given the rise in rental rates. In 2Q2022, rents for private residential properties saw a seventh consecutive quarter of growth, with rents for non-landed properties surging 7.1% on a q-o-q basis, according to a report by Savills Singapore. Rents in the Core Central Region and Outside Central Region saw the highest q-o-q increase of 7.7% each, outpacing the Rest of Central Region which grew 5.9%.
The overall rise in rents has spilt over to Bespoke Habitat — Ong notes that rents for its rooms have increased roughly 20% to 25% in the last three years. However, demand remains resilient, supported by people moving away from the more expensive central areas as well as remote-working trends, he says.
As the company has grown, Ong notes that its services have evolved. One big push has been to use tech to improve the business. “We’re seeing how we can use technology to do much more with less,” Ong says.
The company has built its own mobile app and web-based platform, incorporating enterprise resource planning and customer relationship management systems to smoothen daily operations and provide transparency to both tenants and landlords.
Setting up its own tech platform has also allowed the company to expand in different ways. One of these is switching over from outsourcing maintenance services such as cleaning and air-conditioning servicing to doing it in-house. “When we outsourced [these services], we were 100% dependent on whether our vendors could support us,” Ong explains.
Providing these services in-house allows the company to control the quality of service provided, he says. In addition, it enables the company to integrate the offerings into its proptech platform, helping Bespoke Habitat to stay on top of the upkeep of units while also making sure tenants and landlords are informed when services have been performed.
The next phase of Bespoke Habitat’s proptech expansion will focus on community-building. “We want to introduce benefits to our tenants. For example, when you go to a cafe, you’ll be able to flash your Bespoke pass and enjoy a cup of coffee there on us,” Ong says.
Given the strong demand for its properties, Ong says Bespoke Habitat is looking to further expand its portfolio of rooms. It is eyeing to hit 1,000 rooms by the end of the year based on its pipeline of properties, says Ong. In the longer term, he wants to get to a goal of 2,000 rooms.
As part of this ambition, Ong hopes to scale up the business to a point where Bespoke Habitat can own and manage whole buildings, which would enable it to provide more integrated solutions. “We have plans for a “co-work living space”, where you stay in a unit above, while on levels one and two there is a cafe and co-working space where you can work at,” he explains.
But ultimately, Ong says the company’s priority is to expand where it makes sense, guided by profitability. “For every expansion that we do, we want to make sure that it’s a profitable, predictable model,” he concludes.
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