The Pulse of the Ecosystem: March 2022

March 27, 2022 |

Welcome to our latest installment of The Pulse of the Ecosystem, our monthly recap of the biggest events that took place over the last month and how they impact the current and future state of our ecosystem. 

Let’s dive right in. 

Russia-Ukraine War

Travel actors suspend activity in Russia and Belarus:

  • Starting in March, the US, EU, and Canada closed their airspace to Russian planes.
  • Airbnb suspended all operations in Russia and Belarus and restricted user bookings in both countries.
  • Expedia Group ceased offering travel to and from Russia.
  • Hilton, Hyatt, and Accor froze hotel development in Russia.
  • Many tour operators (e.g., G Adventures) have committed to canceling trips to Russia for the remainder of 2022. 
  • Other companies that have halted activity in Russia include: Booking Holdings, Tripadvisor and Viator, eDreams Odigeo, GDSs, Sabre, Amadeus, and Travelport.

Industry solidarity:

  • Airbnb announced that it would offer free short-term housing to up to 100,000 refugees fleeing Ukraine. Guesty has been heavily involved in supporting this initiative, contacting our broad customer base of property managers and hosts with resources and info on how they can help. 
  • There has been an increase in people booking Airbnbs in Ukraine as a means of donating directly to users whose lives have been affected by the war.
  • Hilton and American Express have announced they will provide up to 1 million rooms to support Ukrainian refugees. 
  • Booking.com is allowing partners to offer free/discounted stays to Ukrainian Refugees, waiving its commission fee for these reservations.

The war has created some uncertainty in the travel industry:

  • 47% of travelers want to see how the conflict in Ukraine evolves before making plans on traveling to Europe this year. 
  • As per Guesty data comparing the weekly averages of February 3rd – 10th (3 weeks prior to Russia’s invasion), with the first week of the conflict (February 24th – March 3rd), new reservations for the summer bookings in the EU & UK actually increased by 5%, while cancellations rose by 23% (which is similar to previous years – including 2019, prior to the pandemic).
  • The prolonged absence of travelers in Russia and Ukraine will have impacts felt beyond Europe, though it is too early to determine what these will be. 
  • Hilton has so far experienced minimal impacts from the geopolitical situation aside from a minor uptick in cancellations. However, there are potentially choppier waters ahead for the veteran hospitality brand in the countries affected. 

Economic Recovery Post-COVID

Ease of COVID-related travel restrictions:

  • In recent weeks, France and Italy waived requirements for vaccinated international tourists to test for COVID.
  • Israel re-opened its borders to unvaccinated foreign travelers and now only requires tourists to test negative on PCR tests twice – once before they fly and once upon arrival.
  • New Zealand re-opened its borders for the first time in two years to foreign travelers.
  • The UK and Philippines removed all COVID-related travel restrictions.
  • Malaysia, Singapore, and Thailand announced their countries’ plans to transition to endemic. 

Short-term rentals attract private equity:

  • Some of the biggest names in private equity firms, hedge funds, and alternative asset management are chasing investment in short-term rentals (STR) / Vacation Rentals (VR) as new assets to diversify their portfolios. 
  • Durable Capital Partners raised $100m in capital for Evolve, a VR property management service. 

Q4 Earnings 

Vacasa 2021 results:

  • Went public in December and achieved record gross booking value (GBV) [$1.9b – 105% increase year-on-year] and record revenue for 2021 ($889m – more than $130m ahead of the target outlined in July 2021). 
  • Grew its inventory by 60% to 37,000.
  • More than doubled the size of its sales force.

Sonder 2021 results:

  • Became a publicly-listed company in January.
  • Revenue increased by 101% from 2020 – Quarter 4 was the third consecutive quarter of record revenue.
  • Global headcount increased 60% year-on-year to almost 1600 employees. 
  • Expansion of property portfolio to approximately 18,100 listings (51% y-o-y increase). 

AirDNA and Transparent Acquisitions

  • Alpine Investors have acquired AirDNA to help fuel the STR data provider’s growth. Founded in 2014, AirDNA provides market intelligence to STR hosts and investors and will be able to enhance its data solutions now that it has Alpine’s support.
  • Transparent has been acquired by OTA Insight, a company that already provides hotel data, and who can now offer an extensive palette of accommodation data with this acquisition. 

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