Business View Magazine | January 2020

12 BUSINESS VIEW MAGAZINE JANUARY 2020 initial public offering in 2020 and Airbnb has also recently signed a sponsorship deal reportedly worth $500 million with the International Olympic Committee, which is a huge shot in the arm,” she said. “Most of their efforts have historically been focused in the U.S. where they amassed most of their supply, but now, with a sponsorship by the IOC, an expanding foothold internationally is a logical element to Airbnb’s strategy. Airbnb enjoys vast brand recognition, despite being considerably younger than its competitors.” Airbnb and Vrbo comprise approximately 90 percent of U.S. alternative accommodation supply. According to Finocchiaro, supply is significant and highly concentrated with 69 percent of listings situated in the South Atlantic, Pacific, and Mountain regions. Conversely, 50 percent of traditional hotel supply is in those same areas. Despite industry growth, regulation is a major headwind for Airbnb and other home- sharing companies alike. Municipalities, under rising pressure from local constituencies and hotel companies, have recently passed strict regulations on alternative accommodation. In 2019, legislation was enacted in Los Angeles, Hawaii, and New Orleans to name a few. Los Angeles requires hosts to restrict rentals to 120 days, must register with the city, and may only rent out their primary residence where they spend at least six months per year. Hawaii restricts advertising of unpermitted rentals with severe fines. Hawaii also limits short-term rentals with an owner living on-site. Rentals in resort areas, including some sections within Waikiki and Ko Olina, are exempt from the new law. In New Orleans, there is a ban on short- term rentals of whole homes in residential areas, hosts may rent out part of the residence they occupy to short-term visitors, and short-term rentals of any kind are banned in most of the French Quarter. Time will tell whether legislation will be strictly enforced and expanded elsewhere but, with Airbnb’s increasing visibility, they will likely fuel the debate about how to effectively regulate the industry. “Airbnb will define the industry in 2020 and one thing is certain. Alternative accommodation is no fad – it’s the Uber to the hospitality industry and it’s here to stay,” Finocchiaro said. Alternative accommodation is no fad– it’s the Uber to the hospitality industry and it’s here to stay