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Crowdsourcing to Fill the Vacancies

Amenities that land a place on lists measuring neighborhood hipness don’t necessarily translate to investment from the traditional hotel industry. But crowdsourcing websites, such as Airbnb, are providing the rental rooms in neighborhoods where hotels are lagging.

Rental locations in Silver Lake, Los Angeles (Airbnb on the left, traditional hotels on the right).

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You’re young, you’re hip, and you’re trying to find a hotel room in Silver Lake, Los Angeles or Wicker Park, Chicago. Well, good luck. A quick Google search showed a grand total of three hotels or motels in the former neighborhood, and one in the latter. What’s a traveler to do?

With increasing frequency, they’re turning to crowdsourced hospitality websites like Airbnb, Couchsurfing, and VRBO.

At last count, there were 152 lodging options in Silver Lake and 34 options in Wicker Park on Airbnb’s website. Even the long-ballyhooed Williamsburg neighborhood in Brooklyn only has four hotels, but 1,313 Airbnb listings. Add in couches, rooms, apartments and houses for rent (or for free) from the other sites, and there are plenty of non-traditional hospitality options to choose from.

This trend fits in neatly with the results of recent report from Airbnb, produced in conjunction with the firm HR&A. Analysis of the site’s activity in San Francisco from June 2011 through May 2012 showed that 72 percent of listed properties are outside of central hotel neighborhoods. These listings are located across the city, with the majority found in those neighborhoods that a real estate agent would define as “up-and-coming.” Silver Lake and Wicker Park fit the bill, what with Forbes naming them as the first and forth “Hippest Hipster” neighborhoods based on walkability, number of coffee shops per capita, assortment of local food trucks, farmers markets, selection of locally owned bars and restaurants, and percentage of residents who work creative jobs.

Yet these factors don’t necessarily translate to investment from the traditional hotel industry. Crowdsourced sites are stepping in to fill the void, and bringing with them lots of dollars. The Airbnb study determined that guests spent $15 million in the past year in San Francisco neighborhoods outside of the central hotel areas, and that 60 percent of guest spending occurred in the neighborhood where they stayed. The website’s average accommodations were $71 less per night than the standard San Francisco hotel, leading to guests staying an average of two nights longer. This means more more in the pockets of local businesses and hosts. Airbnb bookings provided the hosts with between $6,900-$9,300 in average annual income, usually used to supplement rent and mortgage payments.

The site has also proven flexible and effective in a time of emergency. In partnership with the City of New York, Airbnb provided much-needed housing relief by helping hosts organize to provide free lodging in the wake of Hurricaine Sandy. Approximately 140 hosts offered up their homes for free, taking advantage of the fee waiver for both hosts and guests, to encourage more people to participate.

The company estimated that there were nearly 2,500 last-minute bookings for more than 4,000 guests, most likely hurricane victims or relief workers. The quick response to Hurricane Sandy, and lack thereof from the traditional hospitality industry, only solidifies how these sites are stepping up to fill in the hotel gap.

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Tags: chicagolos angelessan franciscocivic techairbnbhurricane sandycrowdsourcing

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