Over the past year, it has been reported that more than 50% of newly built apartments in Seoul have installed dedicated storage spaces for residents. As 53% of households in South Korea live in apartments, numerous attempts have been made to increase value through communities that enhance resident convenience.

This article will explore how self-storage can be connected to dedicated storage spaces within apartments, and what role it can play in the operational strategies of premium residential communities.

The competition of apartment community services influenced by 'operations'

The competition among major domestic construction companies for premium apartment brands is fiercer than ever. Since the layout or location are elements that are difficult to change, community facilities and services that influence the actual living experience of residents are functioning as key strategies for premium offerings.

Community facilities such as gyms, golf practice ranges, and study cafes have become basic options, and a type of hardware competition has followed with apartments featuring swimming pools, cinemas, breakfast buffets, and even bowling alleys within the complexes.

However, the perception is growing that it is difficult to differentiate solely based on these facilities. Satisfaction among residents can vary greatly depending on how the same facilities are operated. Until now, the existence of a gym within the complex was just the starting point; now, we have entered a phase where personal trainers operate exercise programs for residents. We are moving into an era where 'operating services' rather than just 'visible facilities' determine the premium.

The necessity of partnerships with industry-leading 3rd party services

<CGV Gold in Seocho Grand Xi / Source: GS Engineering & Construction>

Since apartment complexes select management entities through resident representative committees, it is challenging for construction companies to manage the quality of operations after residents move in. Therefore, the most realistic and effective strategy is to establish partnerships with the industry's leading 3rd party services from the construction stage and plan the facilities as 'operational assets.'

The construction company that is leading the way in such strategies is GS Engineering & Construction. Xi has been assembling the 'content' of community spaces through collaborations with various industry-leading brands.

They operate the 'CGV Gold' cinema within the complex in partnership with CGV, and in some complexes, they have opted for a Starbucks instead of an unmanned cafe to operate exclusively for residents. There have also been cases of establishing curation-based offline bookstores in the complexes in collaboration with Kyobo Bookstore and providing services that recommend books based on residents' tastes.

In this way, Xi has been on the forefront in reflecting the philosophy of 'how to operate community spaces.' This May, our Second Syndrome signed a strategic business agreement with GS Engineering & Construction to discuss the introduction of premium self-storage solutions in the Xi complexes.

<GS Engineering & Construction X Second Syndrome Business Agreement Ceremony  / Source: Second Syndrome>

Critical issues with existing dedicated storage spaces

Dedicated storage spaces have become an essential element of the design for new apartments. According to Real Estate 114, as of 2023, about 83% of the apartments for sale in the metropolitan area offer dedicated storage, and surveys of residents showed that 76% responded that the presence or absence of dedicated storage affects their apartment choice.

Dedicated storage spaces serve as a storage alternative that does not invade indoor space, with an effect of providing an additional area of about 0.7 to 1.5 pyeong (approx. 23 to 50 square feet) per household. They are particularly suitable for storing bulky items that are used infrequently, such as camping gear, golf bags, and strollers.

<Fire incident in apartment dedicated storage / Source: various media homepages>

However, the problem is that these spaces are practically left unattended without any operational entity after installation. Most complexes only have a gridded mesh fence placed in common underground areas without the minimum safety measures such as temperature and humidity control, ventilation, CCTV, access control, or fire response measures.

As a result, facilities meant to enhance resident convenience are sometimes causing risks and inconveniences. Due to the absence of safety management for storage facilities, there have been instances where residents storing flammable materials led to fire incidents, resulting in injuries and property damage.

Moreover, in a luxury apartment in Seoul, there have been cases where residents filed claims for damages against the construction company, stating that their items stored in dedicated storage suffered from mold or insect damage. Due to the unclear management authority, conflicts among residents have been repeating, resulting in a gradually lower usage rate.

<Cases of leakage and damage to items in apartment dedicated storage / Source: Second Syndrome>

Premium self-storage that replaces dedicated storage

The storage solution being prepared in collaboration with GS Engineering & Construction and Darak is a new level of premium self-storage combined with operational management features and additional services that did not exist before.

Darak implements a high-quality storage environment optimized for apartment complexes based on the technology and data accumulated through operations at over 180 locations nationwide. By utilizing automatic temperature and humidity monitoring, mobile app-based access control, 24-hour CCTV, and real-time sensor detection systems, we can transform the storage areas within the complex into the safest and most comfortable environments.

Additionally, the dedicated mobile app will be integrated with the Xi home IoT system, providing features that allow residents to check the status of their storage in real-time and manage stored items from their homes. Features include a Digital Inventory function that automatically lists items when photographed, a delivery integration service for sending items stored in the storage immediately, and a second-hand trading function that allows residents to easily exchange or sell items.

Furthermore, we are also considering implementing concierge services that safely transport items from the front door to the storage and a cloud service for long-term storage of items at Darak's external storage points.

Darak does not stop at merely providing space but also offers the technology and operational capabilities to evolve dedicated storage into a community platform connected to residents' lifestyles. This innovation will extend beyond simple storage, leading to a smart expansion of overall residential living.

<Storage service through Home IoT integration / Source: Second Syndrome>

New standards of apartment communities: Serviced Storage

The recent agreement with GS Engineering & Construction is not just about introducing facilities, but it will mark the starting point for presenting a new standard for dedicated storage integrated with operations.

Now, dedicated storage is no longer just an auxiliary space. It directly connects to residents' lives and serves as an operational asset that impacts the trust and sustainability of the apartment brand. The image of the entire complex can change with just one dedicated storage space, which will directly relate to sales competitiveness and resident satisfaction.

In the future, Darak will create innovative cases that transform dedicated storage into operationally viable spaces. This trend will not only extend beyond apartment complexes but also expand to senior housing, lifestyle accommodation facilities, and urban residential products at large.