London’s fast-growing co-living sector could benefit from a clearer route through the planning system under proposals contained within the new draft London Plan, potentially helping developers unlock more purpose-built shared living schemes across the capital.
The emerging policy introduces an important change for Large-scale Purpose-built Shared Living (LSPBSL), the planning terminology used for developments commonly known as co-living.
Under the proposals, co-living schemes would ordinarily continue through the viability-tested planning route and make a payment towards conventional affordable housing. However, developments providing conventional affordable housing on site at the relevant threshold could instead qualify for the Fast Track Route.
For developers, investors and design teams operating in the co-living market, the change could provide another option when structuring schemes and their affordable housing provision.
The Fast Track Route is designed to provide greater planning certainty for developments meeting the required affordable housing and other policy criteria, reducing the need for the detailed viability information associated with the viability-tested process.
The proposal comes as London continues to explore different housing models capable of responding to demand while making more effective use of constrained urban land.
Co-living has emerged as one such model, typically combining private living accommodation with considerably larger communal areas and shared facilities. Developments can incorporate lounges, co-working areas, kitchens and dining spaces, gyms, terraces and landscaped areas, with the buildings generally operated under a single management structure.
The draft London Plan places considerable emphasis on the quality of these environments. Proposed policy requires shared living developments to focus on communal living, with internal and external spaces designed to encourage social interaction, alongside functional private living areas. Schemes would also need to be carefully located, designed and managed to complement mixed and inclusive neighbourhoods.
Management is another important element. Large-scale shared living developments would be required to operate under single management, supported by a management plan addressing the continued quality and maintenance of the building, security, safety and service arrangements.
From a built environment perspective, the proposals could have implications extending beyond planning.
Greater certainty around co-living development could create opportunities for architects, contractors, consultants, interior designers, landscape specialists and property management businesses as schemes move from feasibility and planning into construction and long-term operation.
Co-living is particularly suited to complex urban regeneration and mixed-use developments where residential accommodation can be combined with commercial uses, active ground floors, amenities and new public realm. The draft policy specifically recognises that purpose-built shared living can form part of mixed-use regeneration and redevelopment schemes where locations are well connected to local services and public transport.
The wider draft London Plan was published on 16 July 2026 and remains under consultation until 15 October, meaning the policies are proposals rather than adopted planning requirements.
If carried through into the final plan, the new approach could give co-living developers a more defined choice over affordable housing delivery while further establishing purpose-built shared living as part of London’s evolving residential and BTR landscape.
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