Airbnb Changes Its Hotel Strategy to More Aggressive Growth

Airbnb said it is preparing to significantly expand its presence in the hotel sector.

Large business opportunity

According to CEO Brian Chesky, the company previously viewed hotels primarily as a way to fill availability gaps in markets where home listings were insufficient. However, that mindset is evolving into a broader and more ambitious plan aimed at growing Airbnb’s lodging ecosystem across multiple accommodation types.

Chesky explained that the original strategy treated hotels as a supplementary inventory source rather than a core pillar of the business. Now, the company is repositioning hotels as a much larger opportunity that can support growth, improve supply reliability, and attract new categories of travelers.

Regulatory pressure shaping early pilots

Airbnb’s hotel pilots were concentrated in cities with strict short-term rental regulations, where expanding traditional home-sharing inventory has become increasingly difficult. For example, in New York City, Local Law 18 requires hosts to register with authorities and prohibits booking platforms from processing reservations for unregistered properties. These restrictions have significantly reduced the number of available short-term rental listings on the platform.

Similarly, in San Francisco, regulations include requirements that hosts must maintain permanent residency in the property and limits on the number of nights entire homes can be rented without the host present.

Such rules constrain supply growth and create operational challenges for platforms that rely heavily on individual hosts. By incorporating hotels into its marketplace, Airbnb can continue serving demand in these high-traffic destinations even when home inventory is limited.

Expanding supply to meet high occupancy demand

Another factor driving the hotel push is the growing occupancy rate of Airbnb homes in popular destinations. Chesky noted that when home listings are fully booked, travelers still need accommodation options, and hotels provide an immediate solution. This operational reality has contributed to the company’s decision to broaden its hotel strategy beyond regulatory workarounds.

So, what began as a tactical solution to supply shortages has now developed into a long-term growth initiative.

Going beyond boutique and independent properties

At this stage, Airbnb is concentrating on onboarding smaller boutique and independent hotels rather than large hotel groups. These properties often align more closely with the unique, experience-driven positioning that originally defined the platform.

However, according to Chesky, this focus represents only the starting point. The company is beginning with segments that complement Airbnb’s brand identity, while leaving open the possibility of expanding into additional hotel categories in the future. “We’re not saying where we’re eventually going, but this is where we’re focused right now,” Chesky said.

Photo by Patrick Perkins on Unsplash