Hive’s Journey to Facelift the Co-living and Hospitality Industry in MENA: Q&A with Bass Ackermann

Interview edited by Omar Ramy, Staff Writer.

Note from the Editors: This interview has been edited for clarity and length, while preserving the speaker's intent.

Bass Ackermann is a South African entrepreneur reshaping the hospitality and co-living industry in the Middle East, through his venture, Hive. Ackerman earned a real estate degree from Cape Town, and moved to Dubai at 22. After taking on several jobs, he decided to take a break to discover his true passion. However, he was unable to forget the struggles that he faced in terms of accommodation when he first arrived in Dubai; hence, he decided to capitalize on the market gap, and relieve expats and nationals from the pain that they endure when they try to find suitable accommodation. Ackermann founded Hive in 2017, in an attempt to focus on flexibility, convenience and style to allow people to live freely under their own terms.

The Dyorama: What motivated you to create Hive, and how does it align with your vision of the future of living?

Bass Ackermann: I think the idea was sparked very simply by my own pain points and the friction that I experienced moving to Dubai. There are a couple of factors at play, like the affordability issue that you run into, not only the ticket size or the rental price, but more so the payment mechanisms. This kind of forced me into shared housing. My first accommodation was a tiny room in a three-bedroom apartment in JLT with no windows, where I could touch both walls–but I was happy as Larry.

The affordability issue and the issue around convenience and flexibility, being locked into long-term lease agreements, but also the pain dealing with brokers. After four or five years of working here and looking at this as a real estate developer, I thought, hang on a second, there's a massive opportunity here for someone to rejig the traditional sort of rental model to make it more sympathetic, friendly and accommodating.

There was always this dynamic of too much demand, too little supply and that keeps landlords complacent; although it is not hard to change a couple of things. You go to a monthly payment model, if you start implementing an all-inclusive payment mechanism, furnish the unit, make your offer more convenient, and combine these factors together to come up with a more compelling offering; it would be more sustainable towards the future of living.

The Dyorama: How did you decide on JVC as your first location to launch your venture?

Bass Ackermann: I thought the primary target market for us was predominantly Western expats. This is where I come from, and this is the market I knew and understood. I always felt that if you looked at the key neighborhoods where they gravitated towards, it is traditionally the Marina, JBR or JLT. Our hypothesis was simple as a lot of people want to live in the Marina and JLT and JBR, but can't necessarily afford it, and they end up in sub-optimal flat shares in JBR for instance.

The hypothesis would be that people who are willing to move to JVC slightly further away, still have good proximity and accessibility to those areas though slightly compromised on the location, but in return what they get is a private apartment fully furnished, much better quality and offering and so that was really it.

The Dyorama: How did you launch Hive and how did you approach strategic partnerships to develop your business?

Bass Ackermann: In terms of the investment and partnerships journey, I tapped anyone I knew, and that took the better part of 18 months. I think also the culture here is that people don't like to say no, so it took me a while to realize that people being enthusiastic and encouraging doesn't mean they're going to invest. 

Then I met with an architect who I was unfamiliar with at the time, and I pitched my idea to him and he was very enamored by the idea and believed in it. He said “Look I know some guys.” I didn't ask any questions. He asked me if I wanted to go and pitch them. I said absolutely and that turned out to be ARM Holding and they had a fairly new management team in place. 

They were looking at more innovative real estate plays that they could pursue, and I think it was just fortuitous timing. We crossed paths at a time where I'd spent a lot of time sort of delving into this new age business model. They came on board as a shareholder in Hive and also helped to fund the first developments in JVC as a proof of concept.

The Dyorama: How is the MENA region's housing landscape uniquely positioned for co-living and why now? 

Bass Ackermann: The longer I'm here, the more I believe that there's no better market or geographic location than this region for this type of product. Why? Because it's got a population that's dominated by expatriates, so this is not their home. The population is increasing at a massive rate, and it's quite a young population. 

You take those things together and realize that this is actually a hotbed for these modern innovative ways of living. The same thing goes in Saudi, even though the demographic is obviously counter to what it is here in Dubai. It's 90 percent local, 10 percent expat. But again, there you see a lot of people moving from cities like Dammam and Jeddah to Riyadh. They looked at the existing housing stock, and it actually doesn’t fit them. When you take these factors, you realize that it’s just a question of time for someone to fill this kind of gap.

The Dyorama: How do you design spaces that foster belonging in culturally diverse environments like the Middle East, while you're growing Hive?

Bass Ackermann: I think the only thing we've tried to sort of hang our hats on was to make sure our design is flexible and adaptable at all times. In order for people to move things around, you can adapt things like the way they use the space, because it'll also change over time. I think that's key for us; we always wanted to design it in a way that felt warm, welcoming, and a little bit laid-back. 

When you go to Hive JVC, you'll see that although a lot of people work from there, it's not designed as a hardcore work space. It's really a lounge space. People feel at home and comfortable, so I think that's been quite a success. 

The Dyorama: Should Hive be considered as a property management company? What role does technology play in making co-living more than just shared housing, and can it truly define how we connect?

Bass Ackermann: A lot of the modern players in this housing market are pretending to be tech companies. I think technology is there to serve the product as with any good modern business. Your technology stack is critical to your offering, but for us it's very much a business support function.

We honestly don't spend a lot of time and attention in terms of digitally trying to connect people. It's about offline interactions. We use technology to facilitate some interaction in terms of discussion groups and polls and notice boards, but I don't see those as massively innovative or reinventing the wheel.

This is just technology serving as modern communication for us. For most of the community, the connection and collaboration really happens in person; and it happens in moments of serendipity or networking events. Overall, I am a massive proponent of using tech to improve the entire value proposition. 

The Dyorama: What do you think are the most important elements or the biggest challenges in operating the Hive experience? Is it occupancy rates, the community management element, controlling your cost, finding locations, or designing the spaces? What is it that's keeping you up at night?

Bass Ackermann: I would say we focus more on the property operations. The way people look at this product and the way they interact, and the amount of time and attention that is needed from a management team with this product has far exceeded all our expectations. When you live in a traditional building, you generally avoid reaching out to your landlord at all costs. With us, we are always positioning ourselves as we are here.

We speak your language and we're approachable, but the amount of communication and attentiveness that requires is massive. I'd say the service level we have to maintain is to keep people satisfied, because people are basically expecting a five-star hotel living experience. 

However, our business and operational model is not built like a hotel. Our backend is built somewhere in between a traditional residential building and a hotel, to optimize our cost stack. I think maintaining the service levels has been probably our biggest unexpected challenge.

The Dyorama: Can you walk us through One Life Kitchen and Cafe? Is it a revenue sharing agreement that you have in place or are they leasing the space?

Bass Ackermann: From the get-go, we felt that the F&B component was critical to the success of the overall product in terms of having more of a lifestyle positioning. And so, it's actually a funny story because I was always dead set on making sure we found the best possible fit for the building.

I sat down with the architect and interior designer, and I said “Guys, for the restaurant I want it to be on this corner; it should be one of the first things people experience when they come into the building. I want you to take One Life in D3 as the inspiration.” The architect looked at me, laughed and asked me if I was joking. Turns out he designed One Life and I hadn’t known that.

The next day, he put me in touch with Najib from One Life and I knew I wanted us to do this together. We do a simple revenue share. The building feeds them; they feed the building. 

The Dyorama: Where do you see Hive and the co-living movement in 2035? 

Bass Ackermann: I think more and more what's needed is just a modern interpretation of housing that offers more flexibility, affordability and is a bit more community-centric. And so I wouldn't be surprised if what is termed as co-living today kind of just becomes mainstream and an acceptable form of housing.

In terms of their monetization, it might look slightly different across different sorts of socioeconomic positionings. However, I really think that's the way I feel things are moving. The key thing is really that real estate is being repositioned more from a traditional product to more of a service type of solution. 

Specifically in the UAE, you're seeing a massive amount of service offerings coming to market and I suspect that might be pulled back in time. I think it's probably going to be over-serviced, and one might see service charges and other aspects as spoiling the party. I think eventually in 10 to 15 years time, you'd probably see a more rationalized offering there.

The Dyorama: What would your success look like 10 years from now?

Bass Ackermann: It would really be branching out our offering. Not just from an expansion point of view, but also the product type. We really believe in mixed-use integrated development with more of a lifestyle blending modern forms of work with living, with some retail and entertainment in there. It gives you more scale, but it gives you more opportunity to create value. So firstly, I think a network of these spaces across the region, and then the broader market would ultimately be what we're after.

The Dyorama: What is a surprising hobby or passion you have outside of your work that most people wouldn't expect?

Bass Ackermann: I'm very South African in that sense. It's really anything to do with food on fire, fries, and barbecues. I love that: bringing people together, feeding them, around a fire. I also love fishing as I love being on the water, patiently waiting for that fish to bite.