Choice Hotels holiday rentals take on Airbnb and HomeAway

Choice Hotels announced the launch of Vacation Rentals by Choice Hotels, in partnership with independent vacation rental management companies, to offer holiday rental accommodation and compete with operators such as Airbnb and HomeAway. The move has been driven by customer demand for longer-term stays in larger, home-like properties.

Choice Hotels International has launched a vacation-rentals division to compete with companies such as Airbnb and HomeAway.

Vacation Rentals by Choice Hotels is partnering with vacation-rental management companies such as Magical Memories, Sterling Resorts and Bluegreen Resorts, and has launched with inventory in eight locales: Orlando, Destin and Panama City Beach, Florida; Aspen, Colorado; Williamsburg and Shenandoah, Virginia; Phoenix; and Big Bear Lake, California.

Choice says it’s working with management companies with “established reputations for great service and high quality product portfolios.” It is touting the new division’s listings for its customer reviews, images, detailed descriptions and guest access to live operators for assistance.

Choice Privileges loyalty program members will be able to earn points for stays at vacation rentals.

The U.S. vacation rentals and peer-to-peer accommodations sector generate about $23 billion in annual revenue last year according to Phocuswright, or about one-sixth the revenue generated by domestic hotels. Choice’s vacation-rentals division appears to differ from those of companies such as Hilton Worldwide and Starwood Hotels & Resorts (which is spinning off that division) because those companies control the inventory and sell the units via timeshare agreements.

Choice Hotels CEO Steve Joyce, speaking at the Americas Lodging Investment Summit in Los Angeles last month, said at the time that his company was making plans to take on HomeAway and Airbnb by way of a new division, though didn’t offer specifics at the time. Expedia in December acquired HomeAway for $3.9 billion.

“It’s time for brand companies to take back control of our distribution and our destiny,” Joyce said at one of the conference’s keynote speeches. “We’re poised to surf this very crest of this disruptive wave.”

Choice franchises more than 6,400 hotels totaling more than 500,000 rooms worldwide. Its brands include Comfort, Quality, Clarion, Sleep Inn, EconoLodge and Cambria.

The company said last week that 2015 net income rose 4% from a year earlier to $128 million, as revenue rose 13% to $859.9 million. U.S. revenue per available room advanced 6.5%, primarily on room rate increases.