Airbnb is working with some of the multifamily industry's largest landlords in a bid to boost listings and increase its stake in the apartment business.
The San Francisco-based home-sharing company has unveiled a service that will act as a listing platform for developers including Greystar Real Estate Partners, Equity Residential and at least 10 other multifamily owners and management companies across more than 175 buildings in the United States, many of which have previously banned short-term rentals in their properties.
The service plans to allow tenants in a multifamily property to sublease their unit for a set number of days each year as determined by the building's owner, who would then get a cut of Airbnb's revenue from the sublets, typically about 20%. An Airbnb spokesperson said Wednesday a new page on its website would list only so-called Airbnb-friendly buildings, starting with properties in 25 major markets such as San Francisco, Atlanta, Dallas, Houston, Phoenix, Seattle and Denver.
Apartment renters would be able to list their units on Airbnb in a similar manner as homeowners or management companies, the Airbnb spokesperson said, with those tenants earning money from the listings and the landlords potentially securing more leases from tenants who want to host.
“We believe this platform will provide the right tools for both owners and residents to effectively manage short-term rental activity without impacting overall housing supply,” a Greystar spokesperson said in a statement. The Charleston, South Carolina-based company is the largest multifamily management company in the country, with more than 700,000 U.S. apartments. It has listed about 100 of its properties as part of Airbnb's latest venture, including the 525 Olive apartment tower in San Diego and the Argenta complex in San Francisco.
Since its launch more than a decade ago, Airbnb has competed with hotels for a larger portion of the global hospitality market and has butted heads with local government officials who claim the home-sharing company poses a threat to housing affordability and availability. However, the company's approach to partnering with multifamily landlords is an attempt to smooth out its runway toward adding more rental apartments to its platform.
“A lot of people are worried their landlord is going to say no, and that even raising the topic might disqualify them from becoming a tenant,” Airbnb co-founder and Chief Strategy Officer Nathan Blecharczyk told the Wall Street Journal about the new service, adding that most apartment landlords in the past have forbidden short-term rentals in their properties. Some have even incorporated the ban in lease agreements.
Apartments in rental buildings made up less than 15% of Airbnb's total listings in October, according to data from market research firm AirDNA. That portion has declined in recent years, dropping about 5% compared to the same month in 2019 even as the number of Airbnb listings around the world has climbed to record levels.
Airbnb, which has benefited from the pandemic-related hospitality boom and remote-work trends, has more than 6 million listings across 100,000 cities and towns. After a dramatic but brief drop-off in business in the early months of 2020, Airbnb has boomeranged beyond pre-pandemic levels of growth, and, for the first time, reported a quarterly profit of more than $1 billion for the quarter that ended Sept. 30.
Even so, a widespread reckoning across the global tech industry has Airbnb prepared for the worst. Brian Chesky, the company's co-founder and CEO, recently told analysts that he doesn't expect any dip in travel demand, adding that the company was "founded during a recession" and that any potential downturn could be an opportunity.