Airbnb today officially became a public company, launching its IPO and targeting a valuation of roughly $47 billion, confirming what hoteliers have long suspected: The short-term rental giant considers hotels among its closest competitors.
In the COVID-era, short-term rentals have consistently outperformed hotels in the U.K. capital city. Factors including travel restrictions and social distancing measures have influenced performance trends in these sectors, and while both segments have suffered, short-term rentals have consistently outperformed their hotel counterparts.
Rental occupancy on top
As the year began, short-term rental occupancy in London was noticeably lower than hotel occupancy. However, that trend reversed as the pandemic progressed, and short-term rentals have led the market in occupancy for eight of 10 months this year.
In its IPO filing, Airbnb indicated that its main competitors include large chain and Independent hotels as well as boutique hotels.
Data from these specific hotel segments offer insight into COVID-19 recovery in the London market. Beginning with occupancy, short-term rentals outperformed almost all other accommodation types by a wide margin, although serviced apartments came closest to rental occupancy. While these sectors are quite similar, serviced apartments are historically more reliant on business demand and are priced on average £20 ($26.79) per night more than the more economically priced rentals.
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