Airbnb Isn't Really Impacting the Hotel Market

LOS ANGELES—Hoteliers aren't worried about peer-to-peer accommodations platforms, like Airbnb.com. Experts on the Airbnb's Shadow Supply and How It Affects Investors panel at ALIS this week said that they were not concerned about competition from Airbnb, citing all-time high occupancy rates and RevPAR growth as evidence that the Airbnb supply has had minimal impact on the hotel market. Jamie Lane, senior economist at CBRE Hotels Research, moderated the panel of speakers Jason Fudin, director of strategic projects at Vornado Realty; Brenna Halliday, VP of strategic Analysis at Host Hotels & Resorts; Candace C. Johnson, VP of performance optimization at Two Roads Hospitality; and Scott Shatford, CEO of AirDNA.

“I think [the concern about Airbnb] is overblown, but it is hard to get our arms around the industry. We think Airbnb has a minimal impact on our portfolio,” said Halliday on the panel. “As we look at the locations of our hotels, we are comfortable knowing that we are staying in irreplaceable locations.” She added that the firm was encouraged by the recent inauguration, where the company performed very well alongside platforms like Airbnb.

Johnson agreed that the impact of peer-to-peer sites was minimal, adding that the demographic is also much different with a focus on leisure over business and travelers that stay for an extended period of time. “There is a huge difference in our customer profile,” she said. “The demographic is also younger and more price sensitive.”

Interestingly, the panelists also didn't see the Airbnb supply as a new supply, but rather a new platform for an existing supply. Johnson says that many of the users have always had units available for temporary rentals, but now have a better platform to rent those units, so there is an increase in demand for those units. Shatford, who analyzes data from these sites, added that many of the users are also on multiple sites or have multiple listings, which diminishes the actual supply; however, he was quick to add that the power of Airbnb's supply is its flexibility. The supply on Airbnb is so dynamic,” he said. “Supply can come of nowhere and be booked very quickly.”

Shatford, however, wasn't as convinced that there is no impact on the hotel market. “I think it is impacting the hotel industry without a doubt,” he said. He runs Airbnb units in the Los Angeles market, and has seen anecdotally that his users are people that would have otherwise have stayed in a hotel.” He believes that the numbers will reflect the impact in time, and begin to make it difficult for hotels to raise rates to stay competitive with individual users.

LOS ANGELES—Hoteliers aren't worried about peer-to-peer accommodations platforms, like Airbnb.com. Experts on the Airbnb's Shadow Supply and How It Affects Investors panel at ALIS this week said that they were not concerned about competition from Airbnb, citing all-time high occupancy rates and RevPAR growth as evidence that the Airbnb supply has had minimal impact on the hotel market. Jamie Lane, senior economist at CBRE Hotels Research, moderated the panel of speakers Jason Fudin, director of strategic projects at Vornado Realty; Brenna Halliday, VP of strategic Analysis at Host Hotels & Resorts; Candace C. Johnson, VP of performance optimization at Two Roads Hospitality; and Scott Shatford, CEO of AirDNA.

“I think [the concern about Airbnb] is overblown, but it is hard to get our arms around the industry. We think Airbnb has a minimal impact on our portfolio,” said Halliday on the panel. “As we look at the locations of our hotels, we are comfortable knowing that we are staying in irreplaceable locations.” She added that the firm was encouraged by the recent inauguration, where the company performed very well alongside platforms like Airbnb.

Johnson agreed that the impact of peer-to-peer sites was minimal, adding that the demographic is also much different with a focus on leisure over business and travelers that stay for an extended period of time. “There is a huge difference in our customer profile,” she said. “The demographic is also younger and more price sensitive.”

Interestingly, the panelists also didn't see the Airbnb supply as a new supply, but rather a new platform for an existing supply. Johnson says that many of the users have always had units available for temporary rentals, but now have a better platform to rent those units, so there is an increase in demand for those units. Shatford, who analyzes data from these sites, added that many of the users are also on multiple sites or have multiple listings, which diminishes the actual supply; however, he was quick to add that the power of Airbnb's supply is its flexibility. The supply on Airbnb is so dynamic,” he said. “Supply can come of nowhere and be booked very quickly.”

Shatford, however, wasn't as convinced that there is no impact on the hotel market. “I think it is impacting the hotel industry without a doubt,” he said. He runs Airbnb units in the Los Angeles market, and has seen anecdotally that his users are people that would have otherwise have stayed in a hotel.” He believes that the numbers will reflect the impact in time, and begin to make it difficult for hotels to raise rates to stay competitive with individual users.