Hotel Companies Hesitate in Rush to Confront Airbnb at Own Game
(Bloomberg) -- Maybe home sharing isn’t the next big thing for hotel companies after all.
Hyatt Hotels Corp., which has invested in home-sharing startups Onefinestay and Oasis Collections, saw a difficult path to profitability in the business, Chief Executive Officer Mark Hoplamazian said during an earnings call on Thursday. Hyatt, which sold its stakes in both startups, doesn’t plan to get back into the business.
While it does offer some resort rentals through a newly acquired hotel brand, the company’s residential strategy is unlikely “to involve anything that looks like a sharing platform,” Hoplamazian said. “When you’re dealing with high-end properties and you were trying to maintain the level of quality on a consistent basis, the delivery model is expensive.”
Hoplamazian’s comments come days after Marriott International Inc. announced it was expanding its home-sharing business to the U.S. in a bid to prevent loyalty members from booking short-term rentals on competing platforms. The company, which earlier tested the model in Europe, plans to expand to 2,000 homes in more than 100 destinations, including Lake Tahoe and Bar Harbor, Maine. That news followed recent moves by home-sharing giant Airbnb Inc. to expand into parts of the lodging business that look more like the traditional hotel business.
Hilton Worldwide Holdings Inc. isn’t embracing home-sharing either. “We fundamentally think that home sharing is a different business,” CEO Christopher Nassetta said on a May 1 earnings call. “It’s not that it’s a bad business. We just think it’s a different stay occasion, a higher beta experience, and not the premium value proposition.”
©2019 Bloomberg L.P.