The tightening of short-term rental restrictions in various cities may benefit the traditional hotel industry, and established hospitality brands are already preparing to meet this demand, at least according to market giants such as theHyatt network.
In recent years, platforms like Airbnb have transformed the travel market, impacting prices, tourism, hospitality, and infrastructure in the most desirable destinations. This new form of accommodation has transformed the way we travel, but it has also brought challenges to life in large urban centers. The impact of short-term rentals goes beyond tourism, worsening housing shortages and prices in cities like Barcelona, Berlin, and New York.
To curb the impacts of short-term rental growth, several cities have implemented restrictions and new rules, which have generated controversies among residents, owners, and investors. In this context, the traditional hospitality sector has been seeking to strengthen its differentiators to attract this audience.
Regulatory pressure is already reflected in the market: Airbnb's shares fell more than 6% after the earnings call, accumulating a loss of over 7% since the earnings report was released.
In light of this change, hotels are positioning themselves strategically, highlighting attributes that contrast with the vulnerabilities of alternative accommodations, often associated with risks, lack of standards, and instability. Although short-term rentals still attract investors, they pose challenges such as high workload, legal barriers, and unpredictable income. Hotels already offer established advantages, such as security, cleanliness, 24-hour service, and leisure options, capable of attracting increasingly demanding consumers. Highlighting these points becomes crucial amid the growing frustration of travelers with the limitations of the alternative model.
The current scenario is also an opportunity for hotels to attract digital nomads and corporate tourists seeking stability and professional infrastructure. Many already avoid short-term rentals due to unpredictability and prefer hotels for long stays, according to a Morning Consult survey, which shows that 61% of corporate travelers prefer hotels over short-term rentals when the stay exceeds seven days.
Previously, Airbnb was known for offering a certain "authenticity," but now hotels have also started investing in more local and personalized experiences to attract guests. An example of this is the Hyatt Inclusive Collection, Hyatt's line of all-inclusive resorts. "In our resorts along the line, we began investing in local experiences, forming partnerships with small businesses and valuing regional cuisine, without abandoning technology, with solutions such as digital check-in and personalized services," explains Antonio Fungairino, Head of Development for the Americas at Hyatt Inclusive Collection.
Hotels can invest more in extended stays, with outsourced management by specialized operators, making the model more practical and profitable. Long-term accommodations have more stable occupancy and predictable cash flow. Operating multiple units allows for economies of scale and greater profitability.
Investing in multiple units in extended stay hotels helps to dilute risks and face instabilities. Looking at this market, some networks have launched new brands focused on this model, betting on greater resilience and profitability. With pressure on Airbnb due to its impact on neighborhoods, hotels can reposition themselves as leaders in sustainable tourism, creating jobs and contributing to the local economy.
