The American Hotel & Lodging Association (AH&LA) released a new study that provides a detailed analysis of the rise in commercial activity taking place in Chicago on Airbnb, which it claims to be “one of the most trafficked short-term rental websites.” AH&LA built the study on previous research that shows a commercial operators are using Airbnb to run unregulated, and often illegal, lodging businesses.
The study was conducted by John O’Neill, MAI, ISHC, Ph.D., professor of hospitality management and director of the Center for Hospitality Real Estate Strategy in the School of Hospitality Management at Penn State University, and examined activity on Airbnb between October 2014 and September 2015.
Key findings:
- Almost all—96% or $47.6 million—of Airbnb’s revenue in the Chicago metropolitan area came from the nearly 75% of operators who listed unit(s) for rent for more than 30 days per year.
- Commercial operators who listed their unit(s) for rent over half the year (180 days) captured nearly 60% of Airbnb’s revenue in the Chicago metropolitan statistical area at $28.8 million.
- Full-time operators who listed their unit(s) for rent 360 days or more each year delivered nearly $12 million (or almost one quarter) of Airbnb’s revenue in Chicago.
- Operators listing more than one unit for rent drove nearly 40% of Airbnb’s revenue.
“Chicago, like many large metropolitan areas across the country, is seeing a significant growth in the number of Airbnb hosts that are renting out their units full-time, or operating multiple units, as unregulated, and often illegal and unlicensed, hotel businesses,” said Marc Gordon, president & CEO of the Illinois Hotel & Lodging Association. “The rise of these commercial hosts represents a large and growing revenue stream for short-term online rental platforms like Airbnb and a challenge for elected officials who are trying to protect communities and ensure a level playing field for businesses.”
Chicago is the third of 14 cities profiled in a series of reports that comprise a second phase of an analysis into the commercial activity being transacted on Airbnb’s platform.
The full report is available for download on the AH&LA website, here.
