Airbnb and Marriott each want what others have
There are few stronger enemies than Airbnb and the hotel industry. The two have been in each other's throats virtually since the short-term rental giant began back in 2008. Nevertheless, they now seem to agree on at least one thing: they can each learn one or two things from the other.
On Monday, Airbnb adopted a strategy from the hotel's playbook, announcing a fleet of new luxury luxury luxury hotel suites available only to Airbnb guests in New York City. At the same time, the hotel giant Marriott International is in the process of launching its own home rental company.
Marriott, which owns popular hotel brands such as the Sheraton, W Hotels and the Ritz-Carlton, has not yet announced plans for a US based short-term rental program. But it is in the works, according to a report by Wall Street Journal . The world's largest hotel operator has tested the idea through a pilot program in Europe and has planned a global expansion. A public announcement stating the first phase of Marriott's plans to enter short-term rental space could come "as early as next month," the report said.
Marriott has cut out its work in competition with Airbnb, which controls 51[ads1] percent of the short-term rental market in the United States, according to an analysis by Host Compliance, an online rental company, and works with city officials to enforce local laws. The second and third most popular service, VRBO and HomeAway, both owned by the Expedia Group, are said to control 17 and 11 percent, respectively, of the listings.
Booking.com, the hotel and travel agent who owns Priceline and Kayak, claims to offer over 5 million short-term rental listings, and, as Marriott, is often referred to as a viable Airbnb competitor. But it only controls 5 percent of the market, according to Host Compliance.
But Airbnb faces aggressive pushback by local governments in several cities, claiming that Airbnb rentals often act as de facto hotels – without complying with the same laws and restrictions.
Especially New York City – the site of the newest announcement by the Airbase – has been particularly hostile to the company. New York has some of the strictest short-term rental restrictions in the nation, and local officials have been involved in a messy public battle with Airbnb for much of the last five years. Most recently, a federal judge has blocked a New York law that would have required Airbnb to send monthly reports to the city, including usernames, length of stay information, and the addresses of the properties listed on the site.
The By prohibits renting an entire apartment or home for less than 30 days without the owner presenting; only two guests are allowed and they must have "free and unobstructed access to all rooms and every exit in the apartment." Also, it is illegal to advertise certain types of short-term rentals on online platforms such as Airbnb; Fines for violations can be up to $ 7,500.
On Monday, Airbnb announced a partnership with RXR Realty, the owner of a high-rise office in the New York Rockefeller Center, to turn 10 stories of the building into luxury apartment-style hotel suites listed exclusively on Airbnb. It is not the company's first priority in the hotel market. Last year, Airbnb announced it had agreed to buy the last-minute hotel reservation app HotelTonight, allegedly for up to $ 400 million.
On CNBC Monday, if the partnership could worsen the excitement with local authorities, Airbnb CEO and co-founder Brian Chesky suspended RXR Realty CEO Scott Rechler.
"Well, this is completely compatible," Rechler said. Because the building is a commercial space, local laws do not apply to short-term rental housing, Airbnb confirmed.
"We are working on a number of projects here in New York," Rechler said. "And I think it can serve as a prototype … It can work in Miami, it can work in Vancouver, it can work in Montreal."
