Q&A with Balance Out Living’s Co-founders

We speak to Zafar Bhunnoo and Sarah Christie, Co-founders of exciting new co-living market entrant, Balance Out Living.

Zafar Bhunnoo and Sarah Christie, Co-founders of co-living market entrant - Balance Out Living | BTR News
Zafar Bhunnoo and Sarah Christie, Co-founders of co-living market entrant - Balance Out Living.

Who is Balance Out Living?

Balance Out Living is a developer, investor and long term operator in the co-living sector. With backing from Oaktree Capital Management, we aim to create an initial central London portfolio of up to £1bn in gross development value before moving internationally to key cities which have similar underlying fundamentals. That’s the long term ambition.

We secured unanimous planning consent for our first project in February 2022, a fantastic 213-home scheme with a huge array of shared amenity space, just around the corner from Battersea Park, and we’ve got a number of great schemes in the immediate and long term pipeline.

Zafar and I are Co-founders and CEOs and we’ve had a lot of experience across co-living and flexible working, between us holding roles at The Collective, WeWork, Spaces co-living and Blackstone. 

Can you elaborate on the inspiration behind the name?

Yes absolutely, as it goes to the core of what we do. 

Fundamentally we’re a mission driven company that wants to change how we live, providing city-dwellers with the opportunity to thrive and be their authentic selves in an environment which combats issues relating to burn-out and work fatigue – generational defining problems that are all too common and which we have experienced and witnessed first-hand. Urban loneliness is an epidemic we want to tackle. 

What that means is that we believe that the home isn’t just four walls and for some, a garden. It needs to play a role in positively contributing to the mental health and wellbeing of its residents. That means encouraging them to find their balance by staying active, working from home in total comfort, learning, developing themselves, engaging with residents, engaging with the local community, and generally just be somewhere they can happily relax and spend some time.  

We are set on carving out a really clear identity and ultimately we want to get to the point where someone can walk through our doors and say: ‘Ah, this must be a Balance Out Living home’.

Where do your priorities lie at the moment?

We’re in the midst of a very busy period. We’re really excited to be starting on site at Battersea later this year, which includes the delivery of a new sports complex for the neighbouring school (planning permission was granted earlier this year). We will also be progressing the rest of our current 900-plus home pipeline, which we are looking to grow by acquiring well connected sites close to local amenities and good employment opportunities. We want to deliver projects that are sustainable and genuinely add social value.

Thankfully, the GLA and local planning authorities are becoming increasingly receptive to co-living and are more than aware of its genuine benefits. They’re buying into our vision, which is worlds apart from your ‘build-them-high, build-them-cheap and get out’ mentality adopted by some developers.

What does wellbeing look like at a Balance Out Living scheme?

I’m glad you asked. It comes down to three pillars: design, amenity and operations. We’ve got lots of shared external and internal amenity spaces for our residents, all of which will be used on a daily basis as well as flexibly for a number of uses, whether that be for leisure, exercise, work or F&B purposes.

We also have a year-round calendar of events which will be outsourced to some of the best businesses (ideally local ones) in their respective markets, and residents will also have access to a number of brand partnerships providing them with unique benefits. 

Community engagement is also critical. We’ll be engaging with local charities and community initiatives – not only at a corporate level but also a resident level, encouraging our residents to do their bit. 

We are also big proponents of lifelong learning and seek to curate opportunities for our members to acquire and share skills across a whole gamut of topics ranging from finance to spiritualty.

Can you tell our readers a bit about your respective career backgrounds?

Sarah is the co-living queen! She was one of the early movers in the market as Partner and Development Director at The Collective. She lived at their Old Oak Common scheme and absolutely loved it before moving onto WeWork’s co-living brand, We Live. 

Sarah and I actually met on a project when I was working for Blackstone as a Development Manager responsible for around £1.5bn of real estate assets. My work with Blackstone followed six years at London development managers M3 Consulting and most recently Spaces, one of the early pioneers in co-living and where I helped amass a £250m development and operational portfolio over a four year period. 

Many continue to associate co-living with The Collective. Why are you so different?

It’s important to say from the outset here that we both feel much of the criticism levelled at The Collective hasn’t always been just or accurate. There were a number of reasons why The Collective didn’t work out and some of those were entirely out of their control. 

Saying that, there are many lessons to be learned. The key point of difference is that our homes are larger than those at The Collective. We are strictly purpose-built co-living so won’t be pursuing alternative use classes such as student or hotel. Therefore, the design, construction, and operational aspects are considered from the ground-up to create the very best co-living product and platform possible.

We will also offer longer term contracts as standard more akin to ASTs, which really encourages this notion that residents can call this place their home and become part of a community. That’s what we’re going for. And finally, we are completely aligned with a single major capital partner, Oaktree, who share our vision and fund all of the Balance Out Living operations and real estate activities.

Do you think there will be a long-term demand for co-living in London? 

Definitely, and we think the fact that major investors like Oaktree and hugely credible developers like Moda or US players like Greystar moving into the UK market is evidence of shifting industry sentiment. As we said earlier, policy makers also see the potential. 

The underlying fundamentals are strong. In London especially, there is of course the ever-growing affordability crisis, new working habits have taken hold, and there is a general feeling that the country’s fascination with home ownership is dwindling. Renting has increased by 60% over the decade in the UK and the crucial point to recognise here is that that’s a reflection of financial considerations but also choice; to many, renting is really desirable these days.

The natural response here is that well, sure, but doesn’t traditional Build to Rent or BTL speak to that? The reason why co-living is so attractive is that it really taps into what a new generation of renters want from their home. It needs to go way beyond four walls – they want to live, work and play in the same place, they want everything on demand, they want to be part of a community and they want loads of shared amenity spaces. At co-living developments, having studios means we can give more square footage over to these spaces which create, encourage, and foster communities and the various leisure activities they can engage with. 

There’s also something to be said about co-living and the pandemic context, where proper and consistent social interaction was largely denied for well over a year.