Posted in Industry News
Airbnb Exploring Alliances In Multifamily
The Wall Street Journal reports that Airbnb, the world’s short-term rental leader, is now conducting “listening tours” with some of America’s leading apartment management groups. Apartment owners remain a bit skeptical about Airbnb, but they’re willing to discuss revenue-sharing strategies. Multifamily Executive reports that any eventual agreements will take place only in cities that legally allow home-sharing and with hosts that are the primary legal residents.
Most apartment owners don’t want their buildings overrun with short-term renters – but it’s tempting to partner with Airbnb in some situations. Let’s say that a renter leaves a highly desirable beach location in Redondo Beach, California – or an upscale unit in Vienna, Virginia in the D.C. suburbs. The apartment owner could charge perhaps three or four times the long-term rate by welcoming short-timers and splitting the revenue with Airbnb.
Will the home-sharing phenomenon lead to a downturn in new multifamily construction? That’s highly unlikely because there’s still a big demand for long-term apartments in prime locations. Freddie Mac’s 2016 Multifamily Outlook reports that the multifamily units will continue to “enter the market at levels not seen since the 1980s”. While home-sharing companies are seeking opportunities to expand their businesses, there has not been any hard evidence that companies like Airbnb will directly affect the residential construction industry in the near future.
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