The announcement of the MINI Living building marks the latest stage in MINI's evolution from a dedicated automobile manufacturer into a multifaceted lifestyle brand, with a focus on maximising quality of life in compact spaces.
The brand is working with Chinese developer Nova Property Investment Co on the project, which involves converting a former paint factory in the city's Jing'An district into a space for co-living and working that also promotes engagement with the local community.
Construction work is set to begin before the end of the year.
The brand launched the MINI Living project in 2016 to try and apply its "creative use of space" motto to a range of projects that address the effects of urbanisation and the resulting need to accommodate more people in an increasingly small footprint.
MINI has already backed the conversion of a Brooklyn warehouse into a creative workspace, restaurant and design store, and at this year's Milan design week it presented a compact prototype house that could help to filter city air.
At the 2016 Milan design week, the company displayed a prototypal 30-square-metre apartment that incorporated some novel ideas about the potential design of shared urban living spaces.
The brand has also collaborated with Dezeen on the Dezeen x MINI Living Initiative, which has been exploring ways that architecture and design can contribute to a brighter urban future.
In one of the movies produced for the collaboration, architect Sam Jacob and Corinna Natter of MINI Living explained how micro homes, like the one they presented during London Design Festival, could one day function as shared resources.
The collaboration also includes a series of talks about urban living, including one that saw the deputy mayor of Paris compare urban planning approaches in Paris and London.
MINI's decision to expand beyond mobility into other facets of design reflects a trend that has also seen other car brands venture into the design world, as they seek to shift away from a dependance on the sale of polluting vehicles.
With the MINI Living building, the company is applying its ideas to a building project for the first time, offering accommodation, bookable workspaces and services including vehicles for shared use that aim to optimise the use of space in an urban context.
"MINI has always been an urban brand," said Peter Schwarzenbauer, who is a board member of parent company, BMW Group. "It not only has its finger on the pulse of the city, it injects that pulse with extra energy."
"At MINI we are also well versed in the intelligent use of space; back in 1959 the classic MINI was already maximising the experience available within a very small footprint," he continued.
"MINI Living brings this know-how from the vehicles we drive into the places where we live. We are rethinking the idea of living space in the city and developing attractive, need-oriented living concepts. Our aim here is to offer an extremely high quality of life within an extremely small area."
The MINI Living complex will comprise six renovated buildings that will form a new urban neighbourhood including co-living accommodation offered on short, medium-term and extended tenancies.
Co-living is a concept for urban dwellers that offers tenants serviced rooms alongside shared facilities including communal lounges and kitchens that promote interaction between residents.
One of the founders of co-living start-up The Collective told Dezeen last year that home ownership will soon become a thing of the past, as people increasingly prioritise convenience over the commitment of ownership.
Residents at the MINI Living complex will be accommodated in apartments described as "international, modern and clean", with references to the history of Shanghai.
In addition to their compact private homes, tenants will have access to a range of shared spaces, including large lobbies for socialising, an exhibition area and a food market.
Other amenities including gardens, play areas, shops and restaurants will be open to the public, encouraging people from elsewhere in the city to visit and engage with the experiences on offer.
Residents will also have access to digital services including the possibility to make restaurant reservations, book room cleaning and service, and order food or transportation as part of a holistic package for urban living.
"With MINI Living we're looking to create a genuine alternative within the rental market of big cities," explained Esther Bahne, head of MINI brand strategy and business innovation. "We're offering a place that can adapt to its residents, is flexible and allows room to breathe."
"MINI LIVING gives residents their privacy, but also enables them to engage with a variety of different people," she added. "It makes those first steps into a new city that much smoother. The idea is that our residents really feel at home here."