Is Airbnb a Threat to the Hospitality Industry?

Airbnb pic


Seeking a change of pace, Bharat Lall, MD, transitioned from medicine to the hospitality industry in the early 1990s. Today, Dr. Bharat Lall is the President and CEO of Pinnacle Hotels USA.

Since its founding in 2008, Airbnb has commanded a small but growing portion of hospitality industry revenue. In recent years, the hospitality sector has begun to worry. Is Airbnb a threat to hotel chains?

Several recent studies seem to agree that Airbnb is growing steadily, but so is the corporate hospitality industry. After a few slow years, demand is up, and new hotels are being constructed across the country. More than half of Airbnb’s business comes from five major cities: New York, Los Angeles, San Francisco, Miami, and Boston. Hotels in these same cities are reportedly thriving despite the competition.

Airbnb’s impact can, however, be seen in the rates that hotels can charge during peak seasons. Most hotels raise their rates during their busiest seasons, which can make Airbnb look like a good option for budget-conscious casual travelers. The resulting reduction in demand means that hotels may not be able to charge as much as they’d like during these times.


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