At Frank 57 West, a new zinc-clad residential building on Manhattan's far West Side, renters can choose a conventional one-bedroom apartment for about $3,500 a month.
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But for intrepid New Yorkers willing to embrace the concept of "co-living," there is a second option: three-bedroom apartments specifically designed for roommates that can cost more than one-third less per person.
Frank 57 wasn't built by a venture capital-funded startup looking to shake up the industry, but by a major New York property developer, the century-old Durst Organization, as part of a test of how traditional developers can provide co-living spaces for millennials on a budget in new buildings.
"We have a new three-bedroom building design that we are testing in the marketplace, and we have received a very strong response" said Dan Mogolesko, vice president of residential leasing and operations at the Durst Organization.
Co-living, a style of shared urban living, typically involves furnished apartments with communal kitchens and common spaces and an emphasis on amenities and community.
WeLive, a part of shared-office giant WeWork Cos., has created more than 400 co-living apartments in New York and outside Washington, D.C., and recently announced a third project in Seattle.
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Jim Woods, head of WeLive, declined to comment on the new Durst units, but said WeLive focuses on a full service model that simplifies housing choices.
"Whether you're just moving to the city, starting a family or in a new place for business, our apartments are hassle-free and amenity-full, allowing you to focus on what matters most to you," he said.
Now traditional developers are planning similar projects. One developer, Property Markets Group, has begun offering 30 co-living units in Chicago and is planning more around the country, though none in Manhattan.
Mr. Mogolesko said the new design has created an opportunity for young professionals and students "at a price point that is less than other three- bedrooms on the market." At the same time, it has the potential to boost revenue for landlords.
"We think of it as a win-win," he said.
A dozen co-living style apartments, specifically designed for roommates, were incorporated into the Frank, the final piece of a block-square development between West 57th and West 58th Streets near the Hudson River that includes Via 57 West, a 41-story asymmetrical tower with a curvy, ski slope-like wall facing the river.
Since the 10-story building opened at the beginning of July, half of the sharing units have been rented, Mr. Mogolesko said.
These compact apartments, typically just over 1,000 square feet, have three substantial light-filled bedrooms, many with walk-in closets. They come with a stylish kitchen and small entry area with enough room for a table and seating, a washer and dryer in a closet, and two full bathrooms.
The bathrooms include a roommate-friendly feature: doors with indicators showing whether the bathroom is occupied. But the apartment lacks a living room.
The units are available unfurnished or furnished -- with fold-up beds in the bedrooms to give the occupants more floor space, as well as couches and tables -- for between about $6,200 and $7,200 a month, or $2,067 to $2,400 per person, furnished. A cleaning service is available.
For the Frank's owners, that produces a significant premium -- the one-bedroom units rent for about $68 a square foot a year, while the shared three-bedroom ones yield $79 a square foot annually.
The Frank three-bedroom units share some of the features of specially designed co-living buildings, but not all. Even the furnished units at Frank don't come with sheets, towels, pots and pans and televisions such as those provided at the WeWorks site at 110 Wall St. And the Frank's minimum lease term is one year, rather than month to month.
On the other hand, the Frank, like many new rental buildings, includes many co-living-type shared amenities, such as lounges, fitness centers and rooftop terraces, as well as regular group activities like wine tastings and yoga sponsored by the management team.
Ryan Shear, a principal at Property Markets Group based in Miami, said a new division known as PMGx has 5,800 apartments in the pipeline and plans to include co-living spaces in them, in which bedrooms would be leased individually.
Mr. Shear said developers have a natural advantage in this kind of building. "In the end of the day we control the process from soup to nuts," he said. "From buying the land to creating the product."
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(END) Dow Jones Newswires
August 09, 2017 14:54 ET (18:54 GMT)