A multiyear shakeout continues among property managers offering up multifamily buildings.
Wisconsin-based property manager Frontdesk laid off its entire staff of around 200 employees Tuesday, according to a published report, and appeared to have ceased operations.
The company, which focused on managing multifamily buildings in places ranging from the Midwest U.S., to Florida and Pennsylvania, terminated its staff after it failed to raise additional funding, TechCrunch reported Tuesday.
Frontdesk, which saw itself as an up-and-coming big-time property manager in the U.S., had raised nearly $26 million in venture capital, according to Crunchbase.
Frontdesk’s Series B round in 2022 included JetBlue Ventures, Wisconsin Investment Partners, Veritas Investments, and a handful of other venture capital companies.
The published report said that Frontdesk would be pursuing a state receivership instead of a bankruptcy.
CEO Jesse DePinto didn’t immediately respond to a request for comment.
Frontdesk’s website said, “There are no stays available that meet your search criteria,” in response to several searches for stays in various locations that it covered Tuesday evening.
In recent years, the property manager, which was founded in 2017, had scooped up the assets of several rival property managers that folded during the pandemic, and acquired competitor Zencity in June.
“The startup’s business model, which is leasing apartments at market rental rates and furnishing them for short-term rentals in more than 30 markets, has struggled largely due to the upfront costs involved, associated capital expenditures and variables in demand and rates, one of the sources said,” according to TechCrunch.
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Photo credit: An image of a New Orleans short-term rental via Frontdesk, a property management firm that had entered the New Orleans market by acquiring some short-term rentals formerly managed by Stay Alfred. Source: Front desk Frontdesk