From New York to cities Vienna, New short-term rental restrictions – designed to improve housing availability for residents – are set to boost income at hotels. In New York in November, shortly after Airbnb and companies like it were limited to limiting stays of 30 days or longer, hotel occupancy increased 6 percent and rates increased 8 percent, according to commercial real estate firm CoStar. .
However, travelers who work remotely continue to favor rentals, which remains strong in rural areas where rentals are higher than hotels.
“We saw the strongest demand in small and medium-sized cities, coastal and mountain locations, and areas outside major urban centers,” said Jamie Lane, senior vice president of analytics and chief economist. AirDNA, a market research firm specializing in short-term rentals. “The hotel supply is primarily in large urban centers or interstate areas,” he said.
Although rentals are expected to account for just over 15 per cent of accommodation demand in 2024, compared to around 12 per cent before the pandemic, they have posed a serious challenge to hotels. In response, hotels have adopted more residential features.
“Hotels have taken a page from the short-term rental playbook and said, ‘We want our restaurants open to the public and we want the rooms not to be beige boxes,'” said Jan Freitag, national director of hospitality analytics at Costar. Said . “In terms of amenities, the room that was once a place to relax now serves as an office.”
With amenities like kitchens and extended stay spaces, extended-stay hotels are growing rapidly. New brands expected to debut this year include midx studio From Marriott, LivSmart Studio by Hilton And Hyatt Studio,
“We’ve never seen ourselves in competition with hotels,” said global chief operating officer David Whiteside. onefinestay, which rents high-end homes and apartments with concierge service. It was acquired by Accor Hotels in 2016. “There will be times when a hotel is perfect for a family or individual, and sometimes a house, villa or bungalow will be a better choice.”
Meanwhile, hotels are leaning toward what sets them apart: the human element.
Makarand Modi, associate professor of hospitality marketing at Boston University, said that “some travelers appreciate the service of hotels to the point where they go beyond the fare.”