Skift Take

A classic case of the innovator's dilemma.

While many in the travel industry might view Airbnb as simply a homesharing platform, or just another online travel agency like Booking and Expedia, the San Francisco-based company is realizing it has to be more than just a marketplace.

A case in point: the Airbnb Friendly Buildings Program, and the new tools for landlords and property managers that it plans to unveil.

These tools will let apartment landlords and building managers have more control over how their residents homeshare, such as setting caps on how often a unit might be rented or including building rules in Airbnb listings.

Airbnb is also working on a new ways to work with systems such as Yardi, RealPage, Appfolio, and Entrata — systems that many property managers already use to manage their residences — to able to manage Airbnb listings as well. It’s similar to a move the company made in 2017 to make it easier for vacation rental property managers to manage their listings on Airbnb.

Together, these changes are meant to make it easier for landlords to take full advantage of Airbnb’s Friendly Buildings Program and, in some ways, they demonstrate to what degree Airbnb is borrowing ideas from the hotel industry to build up its own inventory.

Some Background on the Friendly Buildings Program

When Airbnb launched its Friendly Buildings Program in 2016, it was billed, primarily, as a way for Airbnb to incentivize multifamily housing owners and developers to allow their tenants to rent out their homes on Airbnb — the incentive being that these landlords would also be able to take a cut from whatever money those tenants made from Airbnb.

Since then, it’s evolved from individual buildings of “tens of thousands of units” (Airbnb was not able to confirm an exact number), to facilitating an entire hotel-like brand.

Last year, Niido Powered by Airbnb was launched by Florida-based real estate and multifamily housing developer Newgard Development Group. In a Niido Powered by Airbnb apartment complex, using Airbnb to rent out your apartment isn’t just encouraged; in fact, the entire property is designed to facilitate it with ease, and even provide concierge services—not unlike a hotel.

Newgard wasn’t just able to get permission to use the Airbnb brand in its new brand promoting “a life worth sharing” — it also managed to get some $220 million in funding from major commercial real estate players Brookfield Property Partners and Silverpeak Real Estate Partners to grow the brand.

Newgard has had some challenges in launching its first Niido Powered by Airbnb property. Existing tenants of the first Niido property in Kissimmee, Florida, said they felt “blindsided” when they found out their home was being turned into, essentially, an apart-hotel.

Even today, you won’t find any mention of Domain Apartments being a “Niido Powered by Airbnb” building on its official website, although Niido’s past events on Eventbrite confirm it as “Niido Orlando.” Still, that $220 million backing suggests the Niido brand isn’t going away anytime soon.

The Hotel Parallels and History Repeating Itself

Also not going away are Airbnb’s intentions of acting more and more like a hotel brand, or even its more mature online travel agency competitors, as it builds up its inventory of places to stay.

The relationship between Newgard and Airbnb, to some extent, mirrors that of a hotel owner and a hotel brand like Marriott, Hilton, or InterContinental Hotels Group. Airbnb and Marriott don’t own any of their properties, but they’ll allow owners like Newgard and others to use their brands and have access to their marketing, sales, and loyalty resources. Similarly, online travel agencies such as Expedia are increasingly focusing on developing tools for hotel owners as they strive to be a global platform.

These new tools that Airbnb is launching seem to suggest that, as a hotel brand would do for its owners, Airbnb is trying to provide the tools its Friendly Buildings partners need to make their Airbnb business a success. And, as some hotel brands have increasingly found, Airbnb may also be finding that it’s better to keep things in house than outsource them to third parties or other partners such as Pillow, a property management service that’s been doing, essentially, what Airbnb’s Friendly Buildings program does, but has been doing it since 2013.

A source close to Airbnb told Skift: “With this new internally built suite of tools, Airbnb will be able to offer a more robust and direct solution for clients independently. The existing partnership with Pillow, for example, is scheduled to end this fall. Airbnb may decide to end that partnership or scale it back significantly because the new tools will make the kind of partnership that is in place today unnecessary.”

If, indeed, Airbnb does decide to either end or scale back its partnership with Pillow and other partners, that wouldn’t be the first time. The company has often absorbed the great ideas of businesses that were specifically designed for its ecosystem, such as tools that help Airbnb hosts better price their listings.

Let’s also not forget that the company is also courting hoteliers and not just landlords to advertise their rooms on Airbnb, too, in an effort to grow its numbers of listings.

All in all, these are signs of a disrupter that’s maturing and, in some ways, looking to the very industry it disrupted for guidance, and a path to follow.

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Tags: airbnb, niido

Photo credit: Airbnb says it is readying new tools to make it easier for landlords to manage theirs and their tenants' Airbnb listings. Airbnb

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