August 13, 2018

Can These Apart-Hotels Compete With Airbnb?

Airbnb has consistently geared their business model toward diverse groups of travelers. In 2017, they began to target upscale consumers who prefer hotel amenities. To take advantage of this, the hotel industry started to offer apart-hotels that combine the comforts of high-end hotels with the space and function of upscale apartment living. In 2018, this space is one of the most competitive markets which leaves consumers asking which is better: Airbnb or apart-hotels?

What Is An Apart-Hotel?

The hotel industry has always offered long-term rooms for a basic rate, which attracts business travelers worldwide. Because of the global success of Airbnb, the hotel industry is revitalizing that concept by changing their design to combine the appeal of apartment living with all the amenities available at a hotel chain. This creates a visually-appealing aesthetic that caters to both business travelers and upscale Airbnb consumers.

Who Is The Airbnb Consumer?

One of the reasons why Airbnb has made a dent in the hotel industry profit is because they offer consumer buying powers that hotels often refuse to give. For example, you check into a hotel expecting to get a room with a fabulous view but turns out to be one of a concrete wall. Single properties give you more choices and provide exactly what you see in photos. Additionally, hotels charge more per person whereas Airbnb offers more value and freedom to families or friends who travel together. The following reasons outline why Airbnb works:

1.     Authentic Experience

When you rent an Airbnb short-term rental property, you get an authentic experience in a beautiful neighborhood. Airbnb is also user-friendly and open to consumer needs.


2.     Consumer Buying Powers To Choose Location And Price

Hotels are generally in the hotel district which leaves you wanting for more when it comes to tourism. Residential neighborhoods also have public transportation routes.


3.     Functionality

The function is one of the most vital components of the value of Airbnb. You have access to a full kitchen, extra bathrooms, private pool options, and a homey vibe.

Can Apart-Hotels Compete?

In a recent article, Bloomberg profiled some apart-hotel operators who have seen large amounts of growth in recent years. Locke, a UK-based brand that incorporates hotel comfort with neighborhood immersion, and AKA, a US-based brand that focuses on security, privacy, and consistency, both agree that Airbnb has been key to their recent success. They claim that Airbnb planted the idea in travelers’ minds that there were alternative options to hotels and the fact that they can deliver Airbnb-esque coziness on top of hotel-like luxury places them into a position where they can compete with both sides of the spectrum.


Apart-hotels now offer kitchenettes, living space that is three times the space of a traditional hotel room, and a sophisticated design aesthetic. The hotel industry is banking on the idea that the apart-hotel blends the best of both industry giants and offers critical elements that consumers want. The hotels are also taking a lesson from Airbnb by learning about functionality and price.


As this is a novel concept, apart-hotels will undoubtedly attract early adopters who want new experiences. However, the jury is still out on whether or not the price will live up to the design hype. This is also an under-represented market, as very few hotels have invested in this transformative design because they are hesitant to take on Airbnb without a clear reward.


Only time will reveal if apart-hotels can survive in the marketplace, but for the time being, they offer a compelling alternative to Airbnb.

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