The annual income generated by a 386-square-foot guesthouse at an apartment community in Frederick, Md., has more than doubled since it was converted to a one-bedroom, short-term rental on Airbnb in April.
Adjoined to the Residences at the Manor, a 583-unit community managed by Horning Brothers, the guest house has earned $4,000 in rent as of mid-August.
The unit, which features a separate entrance and includes a washer and dryer, kitchenette, full bath and living and dining areas, lists for $75 per night and includes a mandatory $25 cleaning fee.
Nicknamed "the cozy suite" by the staff, the living space previously was made available exclusively to guests of residents. But when its leasing consultant Alejandra Blocker noticed how often it sat idle, she decided to post it on Airbnb, a short-term rental listing website.
"We were only earning about $2,000 to $4,000 per year with the unit, which we offered as a perk to our residents and their guests for $85 per night," Blocker says. "I am a user of Airbnb as a traveler. I like it. I wanted to try it out. It seemed like it could work to our advantage."
Blocker says The Residences at the Manor relies on Airbnb's screening program for guests. "Airbnb verifies its users through reviews posted by hosts and guests and it checks guests' social media channels to make sure they are well-meaning and legitimate," Blocker says. "In some cases, it requires a driver's license to participate."
Airbnb Short-Term Relationships
Airbnb has been an oft-discussed topic within the apartment industry for the past year. Its business model has led to residents choosing to violate their lease terms by sub-letting their apartment homes through Airbnb for sometimes steep rents. Residents are doing so despite not having a business license or proper authority. Apartment owners and management companies have then had to decide if and how to enforce their lease terms, often warning residents before sometimes ultimately evicting them for violating their lease.
The past year, Airbnb has been reaching out to apartment owners and management companies in the effort to strike an arrangement whereby the owner, resident and Airbnb can benefit from home-sharing services.
Blocker says the demographic profile of the guests widely varies and that the community has not had any behavioral difficulties with its guests, who typically stay two or three nights, mostly on weekends. The population of Frederick is approximately 67,000. It is in the north central part of Maryland, approximately 50 miles from Baltimore and Washington, D.C. Colleges and universities within 30 miles are McDaniel, Shepherd, UMBC, Towson, Mount Saint Mary's and Gettysburg.
"We get a lot of tourists, or people in town for a wedding, or parents and their children who are coming through to visit nearby colleges," Blocker says. "We haven't received any negative feedback from our residents. Some have been a little bit curious; many aren't even aware of Airbnb, so they don't comment at all."
Blocker and the management company's team gains guest feedback through Airbnb's review section.
"We've had positive and negative feedback," she says. "Guests have commented about how peaceful it is to live here, or mentioned the conveniences of the unit; others have given critiques, which helps us understand how we can improve our guests' experience."
For example, one mentioned that the roll-away mattress was uncomfortable, so Horning Brothers looked to improve it.
Guests typically arrange for key pick-up through the leasing office, which is open seven days a week. When closed, the key is left in a drop box for the guest, who is given a security code.
Horning Brothers has not worked directly with Airbnb during their efforts. Blocker says her company's management team, led by Vice President of Property Management Peter Larson, is looking to expand the opportunity with other apartment homes within its 4,000-unit total portfolio in the Mid-Atlantic.
"We're so excited about the success we've had through this ingenuity and innovative thinking," Blocker says.
Rick Conner, Vice President, Ancillary Services Management, says he sees a trend in clients renting unconventional areas of their properties through Airbnb. "So far, it's been a great move for them."