A Windfall for Hotels
If you thought New York’s new anti-Airbnb law is about protecting the little guy, as its sponsors claim, guess again: It’s really about crushing what the hotel industry and its unions see as a competitive threat. Mike Barnello, chief executive of LaSalle Hotel Properties, last Thursday said the law “should be a big boost in the arm for the business . . . certainly in terms of the pricing.”
LaSalle has four hotels in the city, including the huge ParkCentral. Don’t go looking for a bargain rate there now.
As Airbnb exec Nick Papas noted, “A gaffe is unintentionally saying what you really believe — and the latest gaffe from the hotel cartel makes it clear that the New York bill was all about protecting the hotel industry’s bottom line.”
Barnello is hardly the only industry chief crowing: Vijay Dandapani, head of the Hotel Association of New York City, didn’t publicly cheer the chance to charge more. But he hailed the law as “protecting one of New York’s most vital economic contributors — the hotel and hospitality industry.”
Jon Bortz of Pebblebrook Hotel Trust was more frank in a national “earnings call” last year. The CEO of the firm that owns Doubletree, Embassy Suites and other chains complained that Airbnb had reduced hotels’ “ability to price at what maybe the customer would describe as sort of gouging rates.”
Airbnb isn’t direct competition for the hotel trade — its guests are generally looking for something different from what hotel customers want: a place with a kitchen, say, or in a “real” neighborhood.
Still, the savings available through Airbnb may well have made it harder for Bortz, Barnello and others to charge “gouging rates.” Yet that clear win for consumers has hardly been a fatal blow to an industry that’s boomed in New York City despite Airbnb.
The new state law hits many would-be Airbnb hosts with fines up to $7,500 merely for listing their homes for short-term stays — and the hotel industry surely isn’t done: It will use its victory in New York to push other states to go along.
That would let hotels boost prices nationwide — another dubious “win” for New York’s little guys.