Skift Take

I’m in London bringing you a European edition today. I was here to moderate a panel discussion at the Short Term Rentalz Summit yesterday and it was delightful.

Hope you’re having a good week so far. Hello from across the pond — I’m in London bringing you a European edition today. I was here to moderate a panel discussion at the Short Term Rentalz Summit yesterday and it was delightful. 

The crowd was energetic and lively, the sessions were engaging and entertaining and the tea selection was enviable. 

We heard from companies including KeyData, Beyond, Stripe, Awaze, Numa Group, HomeToGo, Lodgify, and AB Bernstein as well as short-term rental associations including Association of Serviced Apartment Providers and the Irish Self-Catering Federation. 

Here are some noteworthy highlights from the summit:

“Ultimately, we’re all in the business to make profit, and we are not shy to say that. Our organization stands for businesses who want to succeed and profit from environmental, social and corporate governance,” said Ufi Ibrahim, CEO of the Energy and Environment Alliance. 

“The lodging market is much bigger than most people appreciate, and short-term rentals is a small slice of that market. The total vacation rental market today is less than 10% of the global lodging market, and the reason is because emerging markets are much bigger in volume. Asia Pacific accounts for 54% of global lodging room nights in 2019 and in that market, but as we know vacation rentals hasn’t penetrated into that market much,” said Richard Clarke, managing director at AB Bernstein. 

“There is, however, a mismatch in the overall lodging industry between demand and supply of hotel rooms. Hotel supply growth is slow, no one is building many new campsites or hostels. So the elastic supply to bridge this gap will come from the short-term rental market,” Clarke said. 

The part of the conference I enjoyed the most was a debate on the cost effectiveness of generating direct bookings rather than through OTAs. 

Opposing the notion was Janel Clark, program director at Hospa, an association for hospitality professionals. Clark’s argument was OTA commissions may be higher, but they’re good at conversions and the user experience, and have an integrated payment system. The cost of acquisition going through OTAs is lower, Clark said, and this acquisition cost includes the cost of the website, the booking engine, social media, paid search, and marketing. 

“The final cost we need to consider is the cost of getting it wrong, and I am sorry to say this, most often people managing direct channels do not have the skillset or knowledge to make those smart decisions. And you may never know that you have lost out, if you get your pricing wrong,” Clark said.

Louis Andrews, director and president of Ovo Network, which manages ski chalets in the French Alps, as well as Carla Chicharro, head of marketing at proper management software Lodgify, were on the direct booking side.

Andrews argued that it’s more expensive to book through OTAs for both guests and owners. The value of the booking direct is also greater. Direct bookings are more prominent in leisure markets than urban markets and Andrews added that it’s scary to be wholly dependent on OTAs especially in urban markets where supply is already restricted.

Chicharro said direct bookings allow hosts to set their own rules. But stressed that in order to succeed without relying on OTAs, it’s important to build a brand through solid content.

Altido’s Castle Management

British short-term property management group Altido has brought in Middleton Castle, a 600-year-old fortress, under its management. Dating back to the reign of Henry VI, Middleton Castle now welcomes tourists, and offers accommodation — up to 30 guests across 15 bedrooms, including The Lodge and Keepers Cottage. Situated in West Norfolk, this 15th-century addition joins Altido’s portfolio alongside properties like Gilmerton House in Scotland and Galleria in Milan.

HomeToGo Partners with GetYourGuide

HomeToGo, the German vacation rental marketplace, has partnered with GetYourGuide, an online marketplace for travel experiences. This collaboration integrates GetYourGuide experiences into the HomeToGo booking process, offering travelers access to attractions, tours, and activities. 

Katanox Partners with TrustedStays

Dutch travel accommodation distribution and fintech platform Katanox has announced its partnership with TrustedStays, a short-term accommodation provider. TrustedStays will utilize Katanox’s streaming distribution capabilities to connect travel management companies with its extensive network of accredited properties and property managers, making short-stay apartments and homestays accessible to business travelers. This collaboration introduces a previously hard-to-access supply market for corporate bookers, catering to the growing trend of blending business and leisure travel, along with the demand for short-stay apartments in an era of longer but less frequent business trips.

Short-Term Rental Market Surges in Germany, Austria, Switzerland 

In the third quarter of this year, hotel and serviced apartment operators in the Germany, Austria and Switzerland (often referred to as DACH) region, managed annual revenue growth despite prevailing inflationary pressures, property management platform Apaleo found.

Nonetheless, their performance outcomes differed significantly. German, Austrian, and Swiss hotels experienced four times faster growth in RevPAR (revenue per available room) compared to serviced apartments. Hotels registered a 2.9% increase in RevPAR between July and September annually, reaching €74.95. In contrast, serviced apartments saw a more modest 0.7% growth, reaching €86.81, based on the analysis of 3.7 million bookable nights.

Hotels also maintained more robust occupancy rates, with only a marginal annual decline of 0.2% in Q3, almost unchanged from Q3 2022. In contrast, serviced apartments faced a steeper decrease in occupancy, falling by 4.4% annually.

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