Opportunities and challenges posed by the sharing economy

In September of 2016, Airbnb raised US$850 million in new equity, valuing the company at US$30 billion dollars and subsequently crowning it the most valuable lodging provider in the world without owning a single room.

It is a particularly 21st century phenomenon that a company that started eight years ago, with no tangible product of its own, can overtake some of the most storied and well-known brands in the lodging industry.

With each month that passes, the impact of Airbnb becomes more pervasive, and its effects on lodging occupancy and pricing power will become more visible. In the listed space, this will manifest in slower revenue growth, and weaker profitability

This piece seeks to highlight the opportunities and challenges posed by the sharing economy for real estate investors.