Last month Jones Lang LaSalle (NYSE: JLL), in partnership with Lavanda, announced the launch of JLL Short Stays, a short-term stay platform for leisure and business travellers that offers professionally managed stays ranging from three days up to 12 months in various U.K. cities.
In a press release, JLL noted that "Short Stays offers guests a better value alternative to a hotel or serviced apartment, whilst at the same time providing exclusive access to premium urban accommodation professionally managed by the world’s most trusted blue chip operators -- including Greystar, Blackstone, and CA Ventures."
This important announcement allows JLL and its institutional real estate partners and clients to capitalize on the growing demand for flexible accommodations. So, the question among short-term rental and real estate watchers has become, is JLL taking on Airbnb? Let’s find out.
Travel bounceback and business sector
The travel industry has rebounded quickly, with McKinsey reporting that traveling is the second-most-desired activity among respondents of a new survey, second only to dining out. Further, August saw travel spending among Americans hit $92 billion, compared to $100 billion in July, but was the first monthly drop in spending since January.
JLL is hoping Short Stays will capitalize on the ongoing demand for staycations by acting as a professional alternative to hotels.
Business travel has not seen the same recovery as leisure travel. During 2020, business travel to Europe fell 58% to $140 billion, and in the U.S. the picture is just as bleak.
According to a report, a Delta Air Lines Inc. customer surveys forecast showed that around 70% of pre-pandemic corporate travel (domestic and international) will resume only by 2023.
Airbnb reported a 4x jump in revenue in Q2 2021 over Q2 2020, which was even 10% higher than Q2 2019 prior to the pandemic.
Is JLL taking on Airbnb?
What JLL is taking on directly is not necessarily the experience-hunting leisure traveller but the more professional flexible worker and business audience. Although this is certainly one persona targeted by Airbnb, this is a much more direct competitor to medium-term stay platforms and hotel-run businesses like Marriot’s Homes & Villas or Sonder.
Short Stays is a professional alternative to Airbnb rather than a direct competitor. Currently, JLL Short Stays only has 1,000 properties on its platform and operates within the U.K., whereas Airbnb has 5.6 million units across 220 countries.
JLL does plan to expand its short-term rental offerings to 3,000 and move internationally by 2022.
Although still a small unit count, JLL Short Stays has the power and resources to become a larger player in the online travel agency (OTA) space. Because Short Stays is a more professional and managed form of short-term rental, it is more likely to compete with medium-term-stay platforms as well as hotels over Airbnb directly.
That said, with international expansion plans and JLL’s resources behind it, Short Stays could turn into a more dominant player in the short-term rental space over the coming years.