By Deirdre Bosa, CNBC
Airbnb is partnering with a major New York real estate developer, RXR Realty, to convert portions of New York City commercial properties into a “new category of urban lodging.”
They are essentially hotel rooms with living rooms and kitchens that can only be booked through the Airbnb platform, representing Airbnb’s biggest move yet into the traditional hotel space.
The two companies are starting with the iconic Rockefeller Plaza in Manhattan, converting ten floors into “high-end apartment-style suites.” They are also exploring collaboration at other RXR properties, including a development across from the Brooklyn Navy Yard.
Airbnb has partnered with property developers in the past on Airbnb-branded apartment complexes, but with its RXR partnership, Airbnb is for the first time collaborating on hotel-style units.
In a press release, the two companies say they will collaborate on design and services. RXR will be responsible for the execution and management of the locations, while the Airbnb platform will be used to market and book rooms. A third-party operator will manage daily operations.
The release says that the RXR/Airbnb project will be in compliance with union and operating regulations, including that of the New York Hotel Trades Council.
New York City is Airbnb’s largest market in the United States. But the company and other home-sharing services are contending with restrictions on short-term rentals and potential regulations that would require them to disclose detailed information about tens of thousands of listings
In recent years, Airbnb has expanded its offerings to include boutique hotels and luxury properties as it works with regulators and faces increasing competition from online travel agencies and hotels. It now bills itself as an “end-to-end travel platform.”
In March, it announced plans to acquire hotel-booking site HotelTonight to bring more inventory onto the platform and compete better against major traditional hotel chains.
Airbnb co-founder Nathan Blecharczyk recently said that while the start-up is taking steps to be ready to go public this year, “that doesn’t mean we will go public in 2019.”
But when it does eventually tap public markets, the start-up wants to be seen as a “super brand” of travel. It launched Trips, an experiences platform, in 2016; partnered with Resy on restaurant reservations and even thought about adding flight bookings.
The RXR platform manages 71 commercial real estate properties and investments with an aggregate gross asset value of approximately $20.5 billion, comprising approximately 31.4 million square feet of commercial properties, inclusive of approximately 6.0 million square feet of buildings securing debt and preferred equity investments, a multi-family residential portfolio of approximately 2,500 units under operation or development, and control of development rights for an additional approximately 3,700 multi-family and for sale units in the New York Metropolitan area as of June 30, 2019. Gross asset value compiled by RXR Realty in accordance with company fair value measurement policy and is comprised of capital invested by RXR and its partners, as well as leverage.