Niido plans three more Airbnb-branded apartment projects as Kissimmee property nears opening

George Sell By George Sell
03 January 2018 | Updated 03 January 2018

US: The partnership between Airbnb and apartment developer Niido is preparing to open its first building, and has plans for three more.

The project, in Kissimmee, Florida, is specifically designed for tenants who want to sublease their units to short-term guests.

The partnership, backed by up to $200 million in equity financing from Brookfield Property Partners, is called Niido Powered by Airbnb. In early 2018 it will open the 324-unit complex in Kissimmee, close to Disneyland and many other major tourist attractions.

Under the initiative, tenants will enter into one-year leases and would be able to rent their units out for up to 180 days a year. Under a revenue-sharing agreement with management, tenants receive 75 per cent of the Airbnb-generated revenue and landlords receive 25 per cent, according to Niido chief marketing officer and co-founder Cindy Diffenderfer. The monthly rents in the Florida complex will range from $1,300 to $2,000 for units ranging from one to three bedrooms. A Niido app will be integrated with Airbnb and will provide booking and management services as well as short-stay amenities such as keyless entry.

Niido CEO and co-founder Harvey Hernandez said: "We believe the combination is very powerful and look forward to building communities to enhance how people live, share and travel."

Cornell School of Hotel Administration professor Chris Anderson said, "This is a move that many aspects of the industry can learn from as players slowly realise they need to treat Airbnb and other aspects of the sharing economy as partners rather than enemies as they become legitimised, legalised and taxed fairly."

Airbnb is also teaming up with major multi-family landlords such as Veritas Investments as it looks to continue its growth.

The American Hotel & Lodging Association (AHLA) has criticised the move. AHLA spokeswoman Rosanna Maietta said: "With this new ploy, Airbnb has officially deserted the true home-sharing community in favour of commercial hosts who are negatively impacting communities across the country. This partnership should send chills down the spines of every city official across the country, as these types of short-term rental apartments will reduce current and future affordable housing inventory and increase rent for traditional renters in these markets, not to mention allow them to skirt even the most basic of safety, health and zoning regulations."

Editor's Comment

The Florida project is expected to be the start of a concerted move by Airbnb to partner with residential developers - Niido has three more sites lined up with the sharing economy giant and there are sure to be many more waiting in the wings.

Chris Lehane, Airbnb's head of global policy and communications, said that in the past, "the housing industry was keeping its distance. Now, industry leaders are lined up to knock on the door as a potential partner”.

Partnerships with established real estate developers and multi-family landlords (such as Veritas Investments in San Francisco, announced in November last year) allows Airbnb to circumvent the claims made against it by the hotel lobby and local authorities - this revenue stream is transparent, legal and taxed.

The key to its success is to launch in high-demand areas. The Kissimmee project is bound to be attractive to families visiting Disneyland and other local attractions. The Airbnb branding might draw a few extra guests but the golden rule of real estate is the key driver of this venture - it is the location that is key.

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