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Ritesh Agarwal's OYO forays into long-term housing rentals with OYO Living

Ritesh Agarwal's OYO forays into long-term housing rentals with OYO Living

Starting at Rs 7,999 per bed per month, each accommodation will comprise essential amenities like Wi-Fi connectivity, furnishings, television, regular housekeeping, power backup, CCTV surveillance and 24x7 maintenance.

OYO, India's newest unicorn, is certainly going places. Just weeks after raising $800 million in a round led by Softbank Vision Fund, the hospitality company has not only announced plans to expand its international footprint to UAE and Indonesia, but is also eyeing a whole new pie: the home rental segment. The Ritesh Agarwal founded company yesterday announced the launch of its new business, OYO Living, which is working with independent owners and large builders to lease out properties for long-term housing needs of young professionals and students. According to BloombergQuint, this new vertical will offer fully-managed shared residential spaces, in Noida, Gurgaon, Bengaluru, and Pune to begin with.

Starting at Rs 7,999 per bed per month, each accommodation will comprise essential amenities like Wi-Fi connectivity, furnishings, television, regular housekeeping, power backup, CCTV surveillance and 24x7 maintenance. In other words, OYO Living aims to help residents save on brokerage, lock-in periods, and the hassle of searching house helps and support services involved while moving to a new residence. It has already onboarded over 35 properties with 2,000 beds, and plans to scale it up to about 50,000 beds in the next one year across the top-10 metros.

Home rental is certainly a booming business. A FICCI-JLL India study, titled "Future of India Real Estate: Deciphering the mid-term perspective", last month pegged the annual income potential of the student housing space alone at about Rs 1,267 crore. Better yet, the report conservatively estimated the market to grow at a compounded rate of 38% till 2020, to Rs 2,400 crore. "OYO is already the most preferred brand in the budget to mid-segment hospitality space, where our operational expertise in supply acquisition and management, transformation, operations, revenue management, and distribution, through both offline and online channels, has helped us gain significant momentum. Today, with the launch of OYO Living, we are all set to offer something new while remaining true to our core mission of creating beautiful living spaces," Agarwal was quoted saying in a statement.

He added that the new business was conceptualised "based on the feedback and demand" of OYO customers as well as asset partners, and marks a marks a key milestone in the company's journey towards becoming "India's biggest provider of housing". OYO Living has plenty to offer to homeowners, too. Since the business will take complete control of the properties, owners are saved the hassle of property maintenance and security while enjoying guaranteed rental yields.

With this new move, OYO will be vying for a share of the home rental pie against Nestaway, which has raised more than $100 million in external funding to date, and ziffyhomes. Adding to the competition are home rental platforms such as FastFox and Nobroker.com.

Edited by Sushmita Choudhury Agarwal