Airbnb splashes out on Luxury Retreats in order to grow into new segment
Terms of the deal were not disclosed but speculation in recent weeks had suggested that a price in the region of $200 million for the company was on the table.
The Canadian company’s CEO, Joe Poulin, will become the head of Airbnb’s “luxury homes” division.
Luxury Retreats says it has more than 4,000 properties in 100 destinations around the world.
Airbnb says initially the company will operate as a standalone business but over time the listings will be integrated into the existing property-sharing platform.
CEO Brian Chesky says:
“I have spent countless hours with Joe and his team and seen firsthand their passion for delivering amazing hospitality and unforgettable experiences in spectacular places around the world.
“The incredible energy and talent in these teams will help support our mission and grow our community and I’m confident that we will expand our team in Canada in the months and years ahead.”
Acquisition platitudes aside, Airbnb’s decision to spend a large amount of money on a brand with just 4,000 units on the books is a fascinating one.
It follows recent developments over in the hotel world to focus on the luxury end of vacation rentals.
AccorHotels‘s OneFineStay brand this week announced its move into high-end properties outside of the core city markets, whilst the parent company recently bought Travel Keys for an as-yet undisclosed fee.
Splashing out what could be $200 million on Luxury Retreats could signify a lot about where Airbnb currently is with its overall strategy.
Having to buy into a sector – luxury – may indicate that its organic growth in that particular segment has not taken off as liked or has slowed.
Similarly, so-called luxury properties can clearly be sold at a higher margin to travellers who are less worried about securing a deal as those seeking something close to the budget end of their accommodation choice.
Kevin is senior editor and a co-founder at Tnooz. He was previously editor of UK-based magazine Travolution and web editor of Media Week UK from 2003 to 2005.
He has worked in regional newspapers (Essex Enquirer) and started his career at the Police Gazette at New Scotland Yard in London. He has a degree in criminology, a postgraduate diploma in magazine journalism and publishes his first book - a biography about Depeche Mode - in early-2017.