A Hybrid Approach to Short-term Rentals

Gregor, Robert

A Hybrid Approach to Short-term Rentals

Abstract

The owners of a mom-and-pop hotel in Lake George, New York, devised and tested the idea of promoting their property both through traditional hotel channels and by listing the property’s rooms on Airbnb. To make the property more attractive to Airbnb customers, management downsized the hotel from 60 rooms to 35 rooms and added kitchenettes throughout. Even considering conversion costs, financial results were initially promising, with improved occupancy, average daily rate, and funds from operations. In addition to the financial outcomes, the hybrid approach addresses several social concerns about the Airbnb model. Most critically, the property is operating on a parcel zoned for commerce of this type, rather than occupying a house in a residential neighborhood. Consequently, the risk of additional regulation is low, and the property does not add to the real estate turbulence resulting from the purchase activities of would-be Airbnb investors. Finally, since the property is, in fact, a hotel, it is staffed around the clock to address any issues that arise, thus addressing another issue for Airbnb—namely, absentee rentals where guests may conduct rowdy parties.

Date Issued

2023-09-25

Keywords

Airbnb; short-term rentals; Lake George

Rights

Attribution 4.0 International

Rights URI

http://creativecommons.org/licenses/by/4.0/

Types

article