The hotel industry prepares a national fight against Airbnb

Posted On Mon, April 17, 2017 By

Posted On Mon, April 17, 2017 By In Hotels, Policy

With its value nearing $30 billion dollars, it’s hard to deny Airbnb’s influence and disruption in the American hotel industry. Since its founding in 2008, the short-term lodging company has serviced about 150 million travelers, in three million listings in more than 191 countries. And as the New York Times reported, the hotel industry has launched a plan to take action against the company’s growing market share. The plan includes a national campaign at the local, state and federal levels to counter Airbnb by lobbying politicians and attorneys general to reduce the number of Airbnb hosts and fund studies that show they do not collect hotel taxes and are not required to follow the same safety and security regulations that hotels must follow.

Airbnb, Housing, Tourism, Hotel

As 6sqft previously wrote, Airbnb has raised more than $3 billion and secured a $1 billion line of credit. Plus, the company may become a publicly traded. These impressive numbers from investors hurt hotel operators. While Airbnb’s value hits about $30 billion, Hilton’s market capitalization reaches only about $19 billion and Marriott $35 billion. And in many cities during the holidays or during big events where the room rates are usually at a high, Airbnb has caused pricing to decrease.

To combat Airbnb’s popularity, the American Hotel and Lodging Association, a trade group that represents chains like Marriott International, Hilton Worldwide and Hyatt Hotels, plans to lobby for legislation that forces Airbnb to follow the same rules as hotel operators. They’ve formed alliances with politicians, affordable housing and neighborhood groups, and hotel labor unions. In New York, they’re working with local partners to lobby state officials and Governor Cuomo to implement larger fines for NYC hosts that violate laws in hopes that the hotel industry would benefit from an increase in business. In October, the governor signed a bill that would impose steep fines on any Airbnb host who breaks local housing rules. After suing the city to challenge the law, which would fine hosts as much as $7,500 for an illegal listing, the company dropped the lawsuit in December.

The trade group has a budget of about $5.6 million per year for regulatory work. It will focus its efforts in key markets like Los Angeles, San Francisco, Boston, Washington, and Miami. The association will also fund more anti-Airbnb research and roll out a campaign of testimonies from those who have been hurt by home sharing. Troy Flanagan, the vice president for state and local government affairs for the association, told the Times: “We are trying to showcase and bust the myth that Airbnb supports mom and pop and helps them make extra money. Homesharing is not what this is about.”

The group’s efforts may have made some progress on reducing Airbnb’s growth: According to CNBC, a report analyzed data from 127 Airbnb-active cities and found that the worldwide growth of available listings on the company’s website has been on a downward trend each month since this past October. However, in the seven largest Airbnb markets, the U.S., France, Italy, Japan, Spain, the U.K, and Germany, listings grew about 40 percent over the last three months.

[Via NY Times]


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