How to Run a Short Term Apartment Rental Business

How to Run a Short Term Apartment Rental Business

If you’re interested in renting short-term apartments, you might be wondering if such a thing is possible in the Airbnb era.

Airbnb is dominating the short-term rental space with its peer-to-peer model. On the other end, the hotel industry remains the “go-to” solution for shorter stays.

The key is finding your way into that cozy niche between Airbnb and the hotel industry, a daunting task for sure. Don’t lose hope; this niche is the perfect place for “apartment hotels” to flourish.

Managed apartment rental companies are seeking to combine the comfort and convenience of an apartment with the service offerings of a hotel in a short-term rental capacity.

Where do you begin if you want to enter this space, and what can you learn from the hotel industry and Airbnb? Let’s take a look.

Airbnb vs Hotels

A quick Google search of “Airbnb vs. hotels” yields more than 7.1 million results featuring pricing and convenience comparisons between the industry’s primary players. Airbnb continues to grow year over year, and shows no signs of slowing down.

It’s here to stay in the travel and accommodation space, and for good reason. Travelers, as it turns out, enjoy staying somewhere that feels homey while granting access to a kitchen, comfortable furniture, and space to spread out.

That’s a win for you, if you’re in the apartment rental business. If you run a hotel, don’t look away. Chances are other hotels in your industry are taking notice of this trend, and adjusting to meet market demands.

Not every hotel manager or business enjoys—or has time for—the back and forth of messaging individual apartment owners, dealing with unique access and instructions for each unit, and limited rental dates.

That’s where apartment hotel companies come in. They’re filling a niche created by traveler demand and business need, and you can learn from what they’re doing to stay competitive.

An Airbnb Listing

Entering the apartment rental business niche

Apartment rental companies seeking to capitalize on the short-term rental demand fill that space between Airbnb and traditional hotels. Sometimes called “managed apartments” or “apartment hotels,” these companies combine the comfort, space, and convenience of having your own apartment with the fully managed services offered by hotels.

These companies allow travelers to book a private apartment in the same way they would book a hotel room.

If you’re looking to rent properties to travelers, consider listing them as “short-term rentals” for anywhere from one week to 30+ days. Focus on marketing to business travelers who have longer stays in your city.

Play up the hotel-esque features you’re offering as an alternative to staying in someone else’s apartment. While the owners of an Airbnb listing aren’t often around, booking their place can still feel as though you’re peering into someone else’s life.

With apartment hotels, travelers can settle in to a well-furnished and serviced space that feels like it was prepared just for them without battling another person’s knick-knacks or personal proclivities.

What does a typical apartment rental look like?

Pending on the company, apartments offered as short-term rentals can range from one to three bedrooms. They are fully furnished, including a kitchen, washer / dryer, and other conveniences of home.

Companies such as UrHIP, Roost, Zoku and AKA are serving customers by providing apartments similar to what you’d find on Airbnb with added hospitality services such as local fitness club access, cleaning services, and grocery delivery.

Certain companies in this space are unique to one city or area and focus on inspiring architectural design, while others have honed in on offering nationwide bookings.

Pitching an Apartment Rental

So, how do you pitch this to business travelers and the companies who employ them?

With your apartment rental, you’re offering an advantage over a hotel by giving them a place that includes more amenities than a standard hotel room and may be less expensive than renting a hotel room for weeks.

You’re offering an advantage over an apartment by not requiring travelers to sign a 12-month lease. And, you’re offering an advantage over Airbnb by offering a space that’s all their own, rather than invading someone else’s home.

This model makes your apartments more attractive to international visitors who often require flexible check-in times and need more services than an individual listing a room on Airbnb can provide.

You won’t be able to compete with the hotel industry in areas like hosting local events and trade shows, but you can compete for event attendees and vendors.

As Airbnb continues to grow and reach independent travelers or families, extended stay apartment companies are uniquely positioned to serve a niche audience of traveler.

An increasing number of travelers (both business and otherwise) want to eat healthier meals or prefer to cook for themselves due to dietary restrictions or food sensitivity / allergy concerns.

Your apartment hotel makes everything from coffee brewing to having a “home” office space easier.

Key Takeaways

As you explore entering the apartment hotel space, keep these three key takeaways in mind:

There is space for you. If you’re a property manager, pull what you can from Airbnb and hotels as you model your apartment hotel business. Your target market is looking for consistency, hospitality, and comfort.

If you’re an individual short-term apartment renter, use Airbnb to get in front of customers and pitch your unique value proposition. When you craft your apartment listing, focus on young business travelers and offer a significant discount for extended stays of seven days or more.

If you’re in the hotel space, think about how you could adapt this strategy for your hotel. Consider how to create spaces that don’t feel like traditional hotel rooms, which often lack warmth.

While it may not be feasible to create a full apartment space in each room, insert simple comforts such as an in-room coffee corner offering locally roasted coffee or a bookshelf with a few paperback offerings and a Bluetooth speaker for your guest’s smartphone.