Oasis is yet another example of how the travel sector has been testing the subscription model this year. But the company's on-again, off-again investment history with Accor, Hyatt, and Vacasa hints at a broader story. Blended hospitality with leisure travelers is difficult to do at scale.
Oasis, which professionally manages apartment and home rentals in several countries, has launched a subscription model for travelers looking for extended stays, such as for remote work during the pandemic.
At the start, the Oasis Passport will offer stays at about 350 homes in 11 markets out of the company’s 1,300 properties in 15 markets.
Oasis is betting on the rise in remote work, as many companies experiment with having distributed teams during the pandemic. Given today’s uncertainty, the subscriptions’ temporary nature may appeal as an alternative to long-term leases. One of Skift’s megatrends in 2020 was that subscription travel would be the next frontier of loyalty.
“I think the Oasis Passport takes away the ‘Revolution Road’ excuse for knowledge workers, meaning, so many people want this kind of nomadic option, and the ability to truly live as part of another culture, but life and logistics get in the way and it never happens,” said Andrew McConnell, CEO of Rented, a provider of revenue management services to professional vacation rental managers. “The Oasis Passport makes it so easy and turnkey.”
Oasis, founded in Buenos Aires in 2009 and headquartered in Miami, had an early start in serviced home rentals. Yet its attempt to scale up as a venture-backed startup stumbled.
Accor took a small stake in 2016, but that turned into a conflict of interest when the Paris-based hotel giant bought Onefinestay. Hyatt then bought out Accor as well as injected some capital, ending up at about 40 percent ownership. In 2018, Hyatt made it possible for more than 10 million members of its loyalty program to earn and redeem points through stays at Oasis properties.
An unnamed activist investor in Oasis essentially blew that relationship up, Stanberry said. Hyatt cut its ties.
Oasis restructured via a sale to Vacasa in 2018. Since then, Oasis has bought back the brand and international portfolio from Vacasa.
Today Oasis is owned by founder and CEO Parker Stanberry and Steve Frey, an entrepreneur who owns a corporate housing company in Tampa that happens to be called Oasis Corporate Housing, a serviced apartment provider for the corporate sector since 2003. Oasis, a separate company, is no longer backed by venture equity.
Oasis sees the subscription model as a way to generate buzz and revenue.
How Subscription Travel Works
Oasis subscribers can move between different properties, cities, and countries with a fixed monthly cost. Pricing is based on region and number of bedrooms.
Plans start at $1,625 a month for a three-month subscription and $1,550 a month for a six-month term. Pricing is set in a cheaper tier for Latin American destinations than for European locations, which start at about $2,075 a month.
“To hit this price point, which is designed to be accessible to young professionals or creatives, we’ve made a selection of the more affordable properties in our portfolio, in the neighborhoods that are most appealing for a one-to-three-month experience,” said Stanberry, who expects to include about 500 properties by March.
The Oasis subscription service currently covers Barcelona, London, Madrid, Paris, Rome, Buenos Aires, Bogota, Mexico City, Rio, Santiago, and São Paulo. The company plans to expand elsewhere, including to Miami, Austin, and Denver.
The program offers a choice between 25 to 50 unique apartments and homes in these global cities’ prime neighborhoods, ranging from studios to 2-bedrooms. It includes professional housekeeping, access to an “on-the-ground concierge,” and discounted admission to co-working spaces run by Spaces.
Here’s an example of how the program can work. A customer chooses a plan and makes a $250 initial deposit. The traveler picks a destination and books a spot. Let’s say it’s at a one-bedroom in Buenos Aires for a two-month stay. Upon check-in at the Argentine property, Oasis bills the guest for the first month ($1,550) and will continue to bill them monthly. The guest has a year to use the six months of travel. If a guest chooses to move to Barcelona for two months, Oasis will bill them at a different monthly price for that apartment.
Oasis Has Changed Financial Backing
Last year, Hyatt Hotels CEO Mark Hoplamazian commented during an earnings call on its home-sharing investments — first with Onefinestay and then with Oasis. He said that Hyatt’s experiences were ultimately “challenging.”
“When you’re dealing with high-end properties, and you try to maintain a level of quality on a consistent basis, the delivery model is expensive and hard to get to a point where you are receiving, from a financial return perspective, a sustainable model,” Hoplamazian said.
When asked this week about the Hyatt CEO’s comment, Stanberry said, “I really like Mark and found him to be very intelligent, and I agree with his sentiment in several ways. I don’t think anyone has found a way to make the professionally managed concept profitable and sustainable for leisure, short-term stays. That goes for Onefinestay, Sonder, Stay Alfred, Hostmaker, and on and on. It is very hard to deliver high quality and make money.”
“I’d also note that massive public hotel groups don’t have a great track record with corporate venture capital and innovation,” Stanberry said. “The alternative accommodations business is so far afield from their core business that they might not be the investors/partners to make it fly.”
Other hotel brands have dabbled in the sector. Marriott began a test in 2018 of referring guests to about 200 vacation homes in London in partnership with UK-based property management company Hostmaker. But last year Hostmaker collapsed, and Marriott turned to other partners to run its Homes & Villas by Marriott International in about 100 destinations.
Bets on Remote Workers
Hyatt and other global hotel brands have said they continue to evaluate whether there are ways in which they might take part in what one might describe as a more business-to-business, corporate-focused, urban residential play in alternative accommodation.
“That’s more the direction we’ve gone in — an extended-stay orientation, with a 50-night average stay,” Stanberry said. “We’ve had primarily corporate customers, with some digital nomads sprinkled in. Also, no master lease risk, not buying furniture, etc. It might be a smaller total addressable market, but it’s sustainable. We hit profitability in January through March, on around $1 million a month in revenue, and we have maintained breakeven throughout the pandemic.”
For more context on the trend, see our recent stories: Selina Nabs Remote Year in Bet on Subscription Travel for Digital Nomads, Battling Isolation for Remote Workers With New Approaches to Bring Teams Together, and More Momentum Building on Subscription Services in Travel, Will It Help Post-Pandemic?.
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Photo credit: "The Pablo" is a one-bedroom apartment for rent in Barcelona. Oasis