Just in time to spoil the party ahead of Airbnb's long-awaited IPO (which may or may not happen this year, according to one of its co-founders), Marriott is reportedly preparing to launch a home-rental business in the US that will focus on courting business travelers (and hopefully involve fewer creepy hidden cameras).
WSJ reports that Marriott is preparing to expand its home-rental pilot program to Paris after finding success in Paris, Rome, Lisbon and London. Marriott could announce plans for the "first phase" of the new business as soon as next month. Assuming it follows through, Marriott, already the world's largest hotel chain by room count, would be the first hotel operator to push into the home rental market.
Of course, with its purported focus on business travelers, Marriott could steal market share in what is seen as a critical growth market for Airbnb. Though its bookings are popular among leisure travelers, business travelers have preferred to continue booking with traditional hotels, thanks largely to perks like room-cleaning and customer support. To remedy this, Airbnb recently led a $160 million funding round for Lyric, a luxury-rental startup that offers these services to business travelers. It is also developing a unit aimed at corporate travelers that has already attracted signups from some 400,000 companies.
Marriott wouldn't be the first major hotel chain to dip its toe into the home-rental market, but it would be the first to launch its own business in-house. Hyatt's purchase of a minority stake in onefinestay, an Airbnb competitor, has turned into a "negative performer," the company said.
Other global hospitality brands have also dabbled in the home-rental business, but without much to show for it. Hyatt took a minority stake in onefinestay, a company that enables travelers to rent upscale private homes.
Accor, the giant Paris-based hotel company, acquired onefinestay in 2016 but noted in an October 2018 press release that the unit had turned in a "negative performance." An Accor spokeswoman said the company is "continuing its work to turn onefinestay around, primarily through rationalization programs," and that it was introducing new home collections.
Hyatt also took a stake in Oasis Collections and incorporated the home-rental firm’s listings into its distribution system and loyalty program. After the rental-management company Vacasa LLC bought Oasis last year, Hyatt said it was ending its affiliation with Oasis.
With Lyft shares still more than 30% below their IPO price one month after the company's debut, will Marriott's home-rental play - which could face some of the same legal pushback from cities like NYC nervous about missing out on the tax revenue paid by traditional hotels - give investors one more reason to shy away from Airbnb's offering?
Might Airbnb, too, be forced to lower its price range, like Uber has now done (twice)? Or even shelve plans for its debut until 'better market conditions' arise?