The inspiration behind Airbnb came in 2007 when its 20-something founders rented out three airbeds on their living room floor. Today, the online marketplace has 40m members who have stayed in shared accommodation in 34,000 cities.
The meteoric rise of Airbnb has not escaped the attention of traditional hotel companies, which are themselves enjoying a spike in demand from travellers. Is the new upstart a complementary service or one that could undermine their business models? We look at the question here.
Airbnb is an example of businesses that are based on the ‘shared economy’, where the internet enables new ventures to build scale quickly and escape some of the fixed costs that used to be unavoidable.
Car pools and bicycle sharing systems are other examples of the shared economy. And we look at changes happening in the car park real estate market here.
But the rise of Airbnb – and a number of internet-based start-up firms that have been valued at billions of dollars – also has implications for office markets.
Companies like Google, Twitter, Facebook and LinkedIn are part of a resurgent technology sector, the biggest source of demand for new office space. Their requirements are transforming office markets from the inside – encouraging large, more flexible workspace – and from the outside – creating new office districts beyond the traditional CBD. Here we look at the rise of the tech hubs.
Innovations in office design, designed to cater for technology tenants, also have implications for vacancy levels and absorption. Modern offices can accommodate more individuals, meaning traditional ways of estimating occupier levels and achievable rents need to be updated. In this piece, Graham Porter of Aberdeen Asset Management looks at the disruptive potential of ‘invisible space’.
WeWork is another start-up company with a multi-billion dollar valuation. Alongside a growing body of similar organisations, WeWork provides flexible co-working space for start-up firms and entrepreneurs so they can work alongside like-minded people in contemporary urban environments. Sophy Moffat of DTZ looks at the ‘flexible future’ in this article.
These stories are being played out in a number of cities across the world, including Seattle, the original home of Microsoft and Amazon. Seattle forms part of our regular City Focus series, including Munich and Guangzhou.
We look at why Seattle could be dubbed STEM City and question whether investors are funding an experiment in creating brand new districts to cater for its tech tenants.
Guangzhou, meanwhile, has long been one of China’s top manufacturing and trade hubs. But so far this year, IT companies, online retailers and telecommunication companies have accounted for about a fifth of new leases.