Vacation rental manager Vacasa aims to add homes after public listing
Vacation rental management company Vacasa Inc.
plans to use the approximately $340 million raised in its recent public listing to add new homes and features to its platform.
Portland, Oregon-based Vacasa went public this month through a merger with TPG Pace Solutions Corp., a special-purpose acquisition company. Vacasa offers to manage all aspects of property management for owners, including services such as cleaning and maintenance. Rental platforms like Airbnb Inc.
and Expedia Group Inc.
Vrbo generally leaves these tasks to owners.
Vacasa plans to use capital from its SPAC deal to increase the number of rental properties available on its platform, said chief financial officer Jamie Cohen, who joined earlier this year from Angi Inc.,
a Denver-based home maintenance and repair company. Vacasa, which was founded in 2009, currently lists around 35,000 homes for rent, an increase of around 70% from the end of 2020. Adding new properties is a major challenge for companies in the housing sector. vacation rental.
During the third quarter, gross bookings — the total value of reservations, including rent, fees and taxes — were $776 million, about double from a year earlier. By comparison, Airbnb, which went public in December 2020, saw $11.9 billion in gross bookings over the same period.
Vacasa is currently not profitable for a full year, based on adjusted earnings before interest, taxes, depreciation and amortization, but intends to achieve this by 2023.
Vacasa charges owners a management fee of 25% to 30% per booking per night, while Airbnb and Vrbo charge 3% and 8% respectively per booking.
By the end of 2022, Vacasa expects to list about 48,000 homes in the United States, according to a recent investor presentation. Most of the company’s platform properties are in the United States, where it operates in 34 states, as well as Canada, Mexico, Belize and Costa Rica.
“Give us the keys, tell us which nights you want [rent] the property, and we’ll take care of everything else and send you a check,” Ms. Cohen said, describing Vacasa’s presentation to owners. She declined to provide additional details on specific markets where Vacasa aims to expand.
The company plans to attract more individual homeowners by hiring more salespeople and to expand into new markets by acquiring new property managers, she said. Vacasa currently has approximately 8,000 employees, including seasonal and part-time workers.
The company has benefited from a recent vacation rental boom, thanks in part to people working remotely and renting homes for a change of scenery, according to Mike Grondahl, senior research analyst at investment firm Northland Securities Inc. Second home owners are also renting out their homes more often, in search of rental income, he said.
Vacasa doesn’t just compete with the big vacation rental companies. He also needs it to market his ads. About a third of the company’s gross bookings over the past year came from properties listed on its site. The rest comes from listings that Vacasa publishes on Airbnb and other platforms, according to Cohen.
“We provide a lot of inventory, especially in our key markets, to our partners,” she said. Vacasa has exclusive management contracts on its properties, which means that owners do not serve as hosts on other rental platforms at the same time.
Vacasa also plans to use its new capital to add new features to its platform. The company recently launched an app that allows landlords to track things like rental income and guest bookings.
Vacasa is rolling out smart home features across its properties, including smart locks, which allow tenants to open the front door through the Vacasa app, and decibel monitors, which will alert the company to noise levels party disruptors.
Write to Kristin Broughton at [email protected]
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