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Philly’s hotels are doing well and expanding rapidly in the face of 3,257 Airbnb listings.

​• High-level data from AirDNA, a website that monitors and analyzes Airbnb listings, counts 1,064 active rentals in Center City and another 2,193 in surrounding neighborhoods. These lodging alternatives equate to 29 percent expansion of the CBD hotel stock (10 percent if you count only the Center City listings). With an average daily rate (ADR) of $143 and average occupancy of 52 percent, they underperform traditional hotels, which had another record-breaking year in 2017, averaging 78.2 percent occupancy and ADR of around $190.

• How can traditional hotels see record performance concurrent to the recent explosion of non-traditional alternatives? There are several factors. Travel to Philadelphia is up across all segments (business, leisure, convention), but Airbnb seems to create or cater to previously underserved markets and travelers who want off-core pricing, locations, or experiences. More institutional projects are trying to tap into this dynamic: ROOST and Lokal, two Philly-bred boutique concepts, will open new locations in 2018 at East Market and in Fishtown, respectively. 

• 2017 saw 4.5 percent inventory growth in traditional hotels. 2018-2019 will see the supply grow by an additional 16 percent thanks to 1,800 new rooms. Can occupancy and pricing at major flags hold or grow in the face of new institutional product, new boutique concepts, and 3,200 Airbnb listings? Time will tell. 

Source: AirDNA, JLL Research​

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