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Ojai, CA Bans Vacation Rentals and Votes to Subpoena Airbnb and VRBO

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There will be no vacation rentals allowed in Ojai.

After a year of debate, public hearings, policy proposals by a focus group, and suspension of existing rules, Ojai City Council voted 5-0 Tuesday night to make rentals of less than 30 days illegal in all parts of the city.

By Claudia Boyd-Barrett

The ban means the city’s existing zoning code, which effectively prohibits short-term rentals in residential zones but had not been enforced, remains in place. In its ruling Tuesday, the City Council clarified that the prohibition extends to all areas of the city, including village mixed-use zones and commercial areas. Enforcement is expected to begin Feb. 1.

The council’s decision primarily targets informal rentals advertised online through sites such as Airbnb and VRBO, which have proliferated in Ojai and across the country in recent years.

“This online business model circumvents and undermines community zoning laws. It is also an assault on legitimate licensed businesses playing by the rules,” said Councilwoman Betsy Clapp. “These seemingly harmless home-based hotels … impact school enrollment, housing stock, volunteerism and community cohesion. I’ve seen how they have turned neighbor against neighbor. They are not good for our town.”

The council’s decision follows a year of public debate during which several alternatives to an outright ban were discussed. Proposals included limiting the number of rentals allowed, only permitting them during specific times of year and in certain areas, requiring landlords to obtain licenses and pay taxes, and restricting short-term rentals to properties where the host lives on site.

Some vacation rental owners argued that the properties provide needed accommodation for tourists in the city. Others said they relied on vacation rentals to support themselves.

On Tuesday, however, the vast majority of residents speaking to council cited negative impacts from the rentals, particularly disruption to residential neighborhoods and a decline in affordable housing for workers, seniors and families.

“We have a huge deficit in terms of affordable housing. If we allow this precious, precious housing for our citizens to be used for tourism instead of for our residents, we are doing a vast disservice to our population,” said Anita Hendricks. “Please, do not let these places go to tourism.”

Previously, landlords had an option to apply for a conditional-use permit for a short-term rental through the Planning Commission. The council’s decision Tuesday effectively removes that possibility, City Manager Rob Clark said. Only one property in the city has a conditional-use permit and that will remain in place, he said.

Mayor Paul Blatz suggested allowing vacation rentals in village mixed-use zones. However, council members Severo Lara and Clapp said they were concerned that allowing rentals in those zones would still impact city housing stock.

Clapp said vacation rental owners who need extra income can still rent out their properties long-term.

Councilman Randy Haney expressed concern about how an outright ban might affect property owners, but ultimately went along with the majority despite “deep reservations.”

The council also voted 4-1 to subpoena Airbnb, VRBO, and other online rental sites for information on existing vacation rentals in Ojai. Haney voted against the motion, citing concerns about enforcement costs.

Onsite Property Management Association (OPMA) Reaches Major Membership Milestone

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Membership Rental Inventory Exceeds over 50,000 Rental Units in Less than Two Years

Panama City Beach, FLA.  (January 12, 2016) – The Onsite Property Management Association (OPMA), which is focused on and advocates on behalf of onsite rental property management and the growing condo hotel sector, recently attained a major milestone goal for the association. The OPMA membership base now represents over 50,000 rental units of aggregated inventory. OPMA is currently one of the fastest growing national lodging associations in the country and comprises many of the most recognized brand name onsite property management companies and condo hotel properties in the lodging sector.

According to OPMA President and Founder, Paul Wohlford of Resort Collection in Panama City Beach, Florida, he is not surprised by the tremendous, rapid growth of the association in such a short period of time.

“There are recognized brand name onsite management companies and condo hotel properties, like ours, located throughout North America,” says Wohlford. “However, they have all been operating as islands unto themselves all this time and it’s taken the creation of a national association like OPMA to act as that critical bridge to bring everyone in our lodging sector together with a collective mission and purpose.”

Since the initial launch of the association in March 2014, the OPMA Board of Directors established a short-term priority objective of realizing 50,000 rental units of onsite managed inventory system-wide before the close of 2015. An additional goal of OPMA has been to aggregate the largest condo hotel rental inventory in the most popular vacation destinations.

Rick Fisher, Executive Director for OPMA, briefly outlined how this important strategy of collective inventory aggregation in select markets ties directly to a major OPMA initiative.

“We have been assisting our members in measuring and determining their collective economic impact in the local markets they serve. Their impact contributions can now be quantified and shown as to how they directly benefit OPMA guests, owners, members, and area stakeholders,” Fisher explains. “As a result of the continued growth of OPMA member rental inventory, we believe it’s conceivable in select targeted destinations that our collective economic impact contributions, including bed taxes, real estate taxes, employment, and other direct and indirect revenue indicators, could represent the primary financial resource supporting the local market area.”

To interview a member of the OPMA leadership team, please contact:

Rick Fisher

rfisher@theopma.org

(877) 870-6510

 

 

About OPMA

Founded in March 2014 as a 501(c)(6) nonprofit organization, the Onsite Property Management Association (OPMA) is spearheading an effort to support the advancement of on-site rental property management companies. By providing education and advocacy, OPMA will promote the value of the short-term rental experience through on-site property management companies. By leveraging the collective experience of industry veterans, this network of mutual support will elevate industry standards to ensure superior guest and owner experiences. The association is committed to providing a clear and cooperative message and to championing the growth and success of the industry. To learn more about the Onsite Property Management Association, visitwww.theopma.org or call (877) 870-6510.

 

For more information, contact:

Rick Fisher

Executive Director

Onsite Property Management Association, Inc.

rfisher@theopma.org

(877) 870-6510

 

or

 

Mary Jane Kolassa

Paradise

mjkolassa@paradiseadv.com

(407) 463-0040

Oranj Palm Vacation Homes acquires Catalina Island Vacation Rentals

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Oranj Palm Vacation Homes and Catalina Island Vacation Rentals, the leading vacation rental companies in the Coachella Valley and Catalina Island respectively, announced their merger, becoming the largest portfolio of vacation rentals in California. The combined companies offer professional vacation rental property management, marketing, and property maintenance in Avalon, Hamilton Cove and Two Harbors on Catalina Island and in the desert cities of Palm Desert, La Quinta, Indian Wells, Rancho Mirage and Palm Springs.

“This is a powerful merger as the markets of the two companies continue to experience great growth. We are much stronger together. The combined companies enjoy varied seasonality and economies of scale associated with a portfolio of this size,” said Thomas Salinas, President and co-owner of both companies. This merger is the latest milestone for a journey that started in 1972 in Palm Springs and has been delivering expert service for vacation rental owners and vacation travelers in the desert. “The partnership has been long in the making and all parties know that this is a great result for both communities,” says Salinas.

Catalina Island Vacation Rentals offers nearly 200 Catalina lodging properties ideal for every traveler, including Avalon condos, homes and cottages, Hamilton Cove villas and Two Harbors casas. CIVR has developed a great reputation of respect, integrity and the best property management on Catalina Island. CIVR takes pride in the trust homeowners place in the company and in providing the highest level of customer service that homeowners and guests deserve.

With close to 300 vacation properties from Palm Springs to La Quinta, Oranj Palm Vacation Homes offers a wider selection than any other rental agency in the Coachella Valley and the most trusted booking service with state of the art software. Oranj Palm, formerly known as Palm Springs Rental Agency, was inspired by a new visual identity to serve clients the best-in-industry property management service and hotel-alternative experience, all while creating a distinction between their product and that of their ‘rent by owner’ and management company competitors in the space.

$2.2B Capital Injected into Vacation Rental Industry in 2015

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$2.2 billion in disclosed angel and institutional funding has been raised by startups in the vacation rental industry in 2015, and 99% of that investment is being used to build up online marketplaces including Airbnb whose 2015 funding  totaled $1.6 billion and catapulted Airbnb’s valuation to $25.5 billion.

According to Fortune Magazine, over the past year Venture Capitalists have increased their funding of tech startups in virtually every corner of the economy by 92% compared to two years ago. In contrast, the vacation rental industry has seen a 750% increase in funding compared to two years ago.

The market is enticing. In the U.S. alone, the percentage of people over 18 who have stayed in a vacation rental has quadrupled from 8% to 32%, and it is now estimated that there are approximately 1.3 million vacation rental properties in the U.S. and 4.3 million vacation rental properties in Europe. With the size and opportunity of the market along with the fragmentation within the industry, VCs are finding attractive investment opportunities with companies innovating in the vacation rental space.

 

 

Vacation Rental Industry Funding 2011-2011
Funding Raised in Vacation Rental Industry by Company Type 2011-2015
Funding in Vacation Rental Industry by Company 2015
Funding Raised in Vacation Rental Industry by Company 2015
VC Funding in Vacation Rental Industry by Company 2014
VC Funding in Vacation Rental Industry by Company Jul-Dec 2014

 

2015 End of Year Security Summary By Tom K

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Cyber Security for Vacation Rental Managers

By Tom K –The bad guys are still out there, and their attacks keep getting better!

They’re well funded, very focused, and unrelenting. If your company is not well protected, they WILL cause you pain.

As ever, my Holiday gift to you is my annual Security Summary. Do your company a favor… Review it and ensure you’ve implemented the Seven Security basics. Then move on to the advanced security topics. If you do, the bad guys will pass on your company and move on to easier, unprotected pickings.
 

This Year’s Topics:

• CryptoLocker continues to do serious damage
See CryptoLocker: Worse than EVER

• How to prevent your Staff inviting Malware onto your PCs
See Protect Your Company From Your Staff

• Your Vendors may be punching holes into your Carefully Crafted Security
See Who Is Talking To Your Systems… and Who Are Your Systems Talking To???

 

The Seven Commandments of Network Security:

• Centrally managed Corporate Anti Virus Protection
See Protect Your Company from Viruses and Malware with Enterprise Anti Virus Systems

• Centrally managed Windows Updates
See Centrally Manage Microsoft Updates Across Your Enterprise For Free!

• Centrally managed Corporate Spam Protection
See Got Spam? Eradicate Spam and Email Viruses BEFORE they get to Your Environment!

• Use Secure Passwords – don’t make it easy for the bad guys to get in
See Secure Passwords – You need to get this right!

• Have staff lock their PCs when they leave their desks – most attacks come from inside!
See Protect your Company’s Data and Reputation… Lock Your PC!

• If you provide public WiFi, isolate it from your business network
See Securely Implement Public WiFi, version 2015

• Deploy a Firewall at every point where your networks connect to the Internet

 

The Advanced Topics:

• You’re Being Filmed… Watch Your Back
See Eyes Everywhere

• You’re NOT Safe Just Because Some of Your Stuff Is In The Cloud
See Security When In the Cloud

• Protect Your Mobile Identity and Your Mobile Devices
See Protect Your Mobile Identity & Secure Your Mobil Devices

• The Dangers of Remote Access
See Hacked via Remote Access!

• If You MUST Provide Wireless Access to Your Business Network
See Provide Wireless Access to Business Systems???

• Unauthorized Devices Accessing Your Network
See An Anti-Virus Gotcha – It could happen to You!

• The departing Employee – turn a security nightmare into a simple inconvenience
See Departing Employee? How to Process them Gracefully and Securely

• Lock down access to your Corporate Bank Accounts – they’re not insured!
See Protect Your Company Bank Accounts

• Educate your staff to Phishing threats – how to spot them, what not to do…
See Don’t Be the Big Phish

If you’d like help ensuring your network security is up to snuff, or you have any questions concerning any aspect of Corporate Security, I’d be happy to discuss this with you at your convenience. Feel free to contact me at TomK@TomKConsulting.com, or via my cell 443.310.5110.

 

About Tom K

Tom K, has been a senior level Business and IT Consultant providing exceptional solutions to business leaders for more than 30 years. His last thirteen years have been focused on the Vacation Rental and Real Estate industry. He has built strong relationships with all the major systems and services providers in our industry, regularly working with their principals and most senior personnel.

ProResort Housekeeping “Live-In” Seminar Feb 20-27

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Ocean front housekeeping services

Steve Craig and ProResort have done many “Live-in” Housekeeping Seminars that property managers have come to call a vacation rental housekeeping “college.” Craig says, “It is actually more like a “boot camp. What is learned and how it is learned are important, of course, but the intense networking with others is what makes the week so special.”

This year’s ProResort Housekeeping Live-In Seminar will be held February 20 -27, 2016 on St. George Island, FL. about 70 miles southwest of Tallahassee, and there are still a few slots left.

 

The major topics to be covered include the following:

  • Effective cleaning routines and how to teach them, including video training.
  • Proper inspection routines and how to teach them.
  • Effective recruiting, motivating, and incentive pay plans.
  • Carpet care that keeps units looking nice through busy season. You will learn bonnet buffing, carpet repair, and many spotting techniques.
  • Team-building and management “games.”
  • The 12 fundamentals of vacation rental housekeeping
  • How to effectively recruit housekeepers.
  • And much more!!!! (linen controls, dealing with nasty owners, unit evaluations, and on and on and on!) There will be a laundry visitation and many discussions about linen distribution systems

 

Additional information

  • All meals are taken as a group, in the “host” unit. Meals are used as work sessions. You will be sent, once selected, some food preferences/choices. The cost of all meals is included in the seminar cost. Alcohol, sodas, personal snacks: these are at the expense of the attendee.
  • There are 8 attendees only. They all live in the same house. The entire cost of this housing is included in the seminar fee. You can see the property at http://www.resortvacationproperties.com/rvp/vacation-rentals/property-details/index.php?propid=7392&SRCH=tr
  • Classes start at 8:30am each day, dinner ends by 7pm, then there is homework each evening, including group projects. On Friday evening we will go out to dinner and drinks (Included in the fee) for an “awards dinner” function.
  • The items not included in the fee are your transportation to the property (all transportation during the classes themselves is provided) and any incidentals, snack items, liquor, etc. Long distance calls from the host unit are FREE for all attendees!
  • Once you save a spot, we send travel info regarding airports, traveling directions, etc.

 

Tips from previous seminars

  • It has never worked out when husbands and wives attend together. One or the other, not both. We will take your money but don’t suggest this be done.
  • This is a vacation rental housekeeping seminar, not a hotel or timeshare seminar.
  • We are often asked, by those who live close to the seminar site, if they can attend and not have to stay overnight in a unit. The answer is yes (and a housing credit is given on the fee), but we recommend against it because the networking and cooperative homework are absent from their experience, and those who have done it have felt their experience was diminished.
  • The seminar will be hosted by Resort Vacation Properties of SGI. Checkin is any time after 10am on Saturday February 20 but you must be there by 5pm for the Welcome Reception and your first homework assignment. and checkout is after cleaning and inspection tests on February 27.
  • The cost is $2650 per person inclusive of housing and meals and all seminar materials and sample products. For the two that share a bedroom, the fee will be reduced to $2500.

 

How to save your company’s spot at the seminar

  • You can call, fax, or email to save a spot (s) officially for someone in your company.
  • You don’t need to have a name of the attendee at this time.
  • By mid-January, if you select a slot, you will be sent a detailed packet with travel info, a detailed agenda, etc.
  • You will then have until January 31, 2016 to notify us of the actual person to be attending if you have not done so already.
  • Payment in full will also be due by January 31, 2016 or your slot will be forfeited.
  • Contact info: Stephen R. Craig, 850-303-1358, proresort@aol.com

 

 

Comments from Previous Attendees

Gwen Polk of Meyer Real Estate says: “After the live-in seminar I was so filled with excitement and enthusiasm that I could hardy wait until I got back to Gulf Shores to start utilizing what I had learned. We sent another of our staff last year and she came back so pumped up and excited and she has been able to perform her job better than either of us had ever hoped.”

Kathy Manning of Emerald Isle Realty says “This was the single best experience of my professional housekeeping career. We have since sent two others to this seminar”

Diania Whitehead of Ocean Resorts says “I learned more in one week than I had ever dreamed was possible.”

Nancy Dusault of Pahio Resorts says “Thank, you, thank you, thank you for giving me this opportunity to learn so much with such neat people. I am sure we will be fast and firm friends forever!”

Holly Montorio of Dunes Beach Home Rentals says “I can honestly say that this class laid the solid foundation of knowledge that will enable me to be successful for many years.”

Nancy Boyle (retired owner of a vacation rental company) said “Yes, I paid to attend. All I had ever heard about housekeeping was that it couldn’t be done successfully. So my head housekeeper and I attended together, and what we learned together changed the way we did housekeeping forever.”

RGI hands VRMA management reins over to SmithBucklin

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On December 1, the management of the Vacation Rental Managers Association (VRMA) shifted from Raybourn Group International (RGI) in Indianapolis to SmithBucklin in Washington D.C.

In an announcement to the VRMA’s membership, VRMA President Ben Edwards said, “We are excited about this opportunity to partner with SmithBucklin, the association management and services company more organizations turn to than any other. SmithBucklin has extensive experience in managing and growing professional trade associations such as VRMA. In particular, its experience in government affairs and advocacy efforts will assuredly help us navigate the ever-changing regulatory landscape and help fight anti-vacation rental legislation.”

As the association moves under new management, several VRMA members expressed their appreciation for RGI’s performance over the last six years.

“RGI is a class act, with great people who I will personally miss,” said Kyle Buehner, CEO at NAVIS. “They did a tremendous job helping our organization (VRMA) transition during a very difficult period. Further, during my five years on the board, I found them to be an exceptional management organization.”

Alex Risser, President at Outer Beaches Realty agreed. “RGI was a main reason for the success of VRMA over the past number of years,” said Risser. “Our Association has increased revenues, exceeded our goal of over 1,000 attendees at annual conferences, taken corporate sponsorships to levels exceeding initial expectations, and provided extremely competent and efficient staff to undertake the routine and many projects assigned by the Boards.”

The following tweet from outgoing Executive Director Mark McSweeney demonstrates the growth in key performance metrics during RGI’s leadership.

 

 

Risser added, “They were extremely professional, provided extensive in-house education for their own staff, and were very active in their own professional association. Several years ago, a consultant was hired to assess the performance of RGI for VRMA. Their report was very favorable that RGI was serving the VRMA well. What’s happened since to have made this decision is beyond me, but we have to trust that the current Board has sound reasons for having done so.”

Alan Hammond, Managing Director at Holiday Vacation Rentals, also conveyed appreciation for RGI”s performance saying, “During my time as a board member I felt that RGI served the Association well, particularly in planning VRMA conferences which are extremely important to membership growth, education and professionalism. RGI not only guided the VRMA through tumultuous times, but was instrumental in helping the Association in reaching sound financial health. I trust the new board made its decision wisely and in the best interest of professional managers and the Association.”

“Having served on several committees and as a Director for VRMA, I had the opportunity to work closely with each team member at RGI,” said Betsy LaBarge. President and CEO at Mt Hood Vacation Rentals. “To a person, everyone was always very professional and very friendly. The RGI team cared about the vacation rental industry and it showed in their work; they represented the best interests of the vacation rental industry and the association in everything they did. It will be a tough act to follow and I hope the new management team will be able to ramp up quickly to meet and exceed RGI’s accomplishments.”

“The VRMA is not your typical association,” said Heather Weiermann, Systems Consultant at NAVIS. “Therefore the individuals RGI assembled to work for VRMA could not be typical either. They were hand selected for our organization. As a result, they lived and breathed VRMA. Their collective knowledge, passion and dedication made them a very effective team that will be hard to replace.”

“I wish the staff at RGI the best, they will be missed,” said Hammond.

Recap of the New England Vacation Rental Managers Association’s Annual Meeting (NEVRMA) by Atlantic Vacation Homes

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By Michelle Fonvielle Williams, Atlantic Vacation Homes — On Monday, December 7, 2015 vacation rental managers from all over the Northeast came together for the New England Vacation Rental Managers Association (NEVRMA) regional meeting. Representatives from twenty vacation rental companies (including Atlantic Vacation Homes) and nine supplier companies met to share ideas, best practices and stories as well as to discuss top issues & trends in the industry.

The infographic below gives some of the day’s highlights.

 

NEVRMA Recap by Atlantic Vacation Homes

 

Coaching Housekeeping Staff: A Lesson from Vince Lombardi

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By Durk Johnson — One of the greatest NFL football coaches is Vince Lombardi. At the beginning of each season he would take grown men, some of whom had played football for decades, and hold up a football and say “Gentlemen, this is a football.” He would then explain the basics of the game. After a while they would move to the football field and the explanation of how the game is played and the objective of the game would be explained.*

As leaders and managers we need to do the same thing with returning seasonal staff and fulltime year round staff. We need to cover the basics of what we do and why we do them.

Here are a few housekeeping basics to cover:

 

1. Housekeeping Kit

Discuss how and why each chemical or tool is to be used. Take the time to do demonstrations of proper ways and improper ways, so they can see how it is to be used. The basic housekeeping kit should have:

  • rags (microfiber are the best ones to use)
  • bathroom disinfectant cleaner
  • all purpose disinfectant cleaner
  • a room deodorizer
  • a mild wood floor cleaner
  • razor blades for smooth top cook stoves
  • oven cleaner
  • pumice stone
  • magic eraser
  • gloves
  • trash bags
  • doodle bug
  • a large lint roller

 

2. Inspection Kit

Talk about the necessity of the inspection kit and how it can help them be effective at doing their inspections. What is inside the kit is going to vary on what guest amenities are provided and what expectations you have for your inspectors? Some of what should be included would be:

  • toilet paper
  • paper towels
  • guest amenities (if provided)
  • batteries
  • multi tool
  • laundry soap
  • dishwasher soap
  • any guest specific items that your company provides

 

3. Specialty Cleaning Products

I call them specialty cleaning products because only certain people have access to them and are trained to use them. There are two types of products I would like to highlight today:

  • an enzyme product that eats proteins, such as urine, blood, vomit, and beer just to name a few
  • a product to address mold and mildew that includes Australian Tea Tree Oil

 

4. Piece Rate

All housekeepers should be paid piece rate. This motivates the housekeeper to clean with speed and quality.

 

5. Inspections

Every arrival must be inspected for housekeeping quality and guest readiness. This inspection allows the inspector to make sure all is in order in the home. Some items include:

  • pillows are staged right
  • blinds are set appropriately
  • thermostats are double checked and temperature is set correctly for the time of year
  • doors and windows locked
  • kitchen pots/pans, plates, cups, utensils, and all other items placed neatly in the cabinets
  • correct number of hangers in closets and placed in the correct location on rod
  • appropriate number of towels in each bathroom

 

6. Standard Property Appearance (SPA)

Every company should have a document that illustrates and explains how the property is to be left when the housekeeper and inspector have completed their work. This document is not easy to create. It takes a lot of thought and work, with many people and departments collaborating for the final product. Once complete, everyone knows how the property is to look when the housekeeping staff have completed their work. Follow the wall – this procedure is a foundational housekeeping principle and every housekeeper and inspector should use it every time they clean, inspect, or check a property.

Some of the items this document addresses are:

  • how the towels are hung and where
  • how many rolls of toilet paper are left and where
  • how many paper towels are left and where
  • how the blinds are set for an arrival or departure

One last item for you to consider, every housekeeper is a memory maker. Every time a housekeeper or inspector does work in a property they are a part of memories made in the property. We need to remind our staff of this.

If you have any questions you can visit www.VRHP.org or reach out to me for more information.

* Vince Lombardi, in Donald T. Phillips, Run to Win: Vince Lombardi on Coaching and Leadership (2001), 92.

2015 Acquisitions of Vacation Rental Management Companies

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In 2015 the vacation rental industry has seen a staggering $2.5 billion of disclosed venture capital injected. Expedia announced it will purchase HomeAway for $3.2 billion. Airbnb boasts a $25.5 billion valuation. The vacation rental industry is also seeing investment, consolidation and acquisitions among vacation rental managers.

Related: It may be one of the best times to sell, but are you ready?

 

2015 Acquisitions of Vacation Rental Management Companies

As 2015 comes to a close, let’s look back at this year’s acquisitions of vacation rental management companies.

 

Purchaser
Acquired
Units
Month
Year
Vacation Rental Pros
Hilton Head Rentals and Golf
230
Dec
2015
Natural Retreats
American Mountain Rentals
55
Nov
2015
Vacasa
Seaside Services
73
Nov
2015
Vacation Rental Pros
Five Star Vacation Rentals
60
Sep
2015
Vacasa
Chelan Vacation Properties
175
Aug
2015
Natural Retreats
Mammoth Front Desk
70
Jul
2015
Wyndham Vacation Rentals
ResortQuest Whistler
600
Jul
2015
Mike Harrington
Topsail Realty
170
Jun
2015
Wyndham Vacation Rentals
Vacation Palm Springs
450
Jun
2015
Wyndham Vacation Rentals
Corolla Classic Vacations
200
Apr
2015
Vacasa
Blowin in the Wind
51
Apr
2015
Vacasa
Mixon Properties
21
Apr
2015
Resort Collection
Laketown Wharf Resort
300
Mar
2015
Pacifica Companies
Sterling Resorts
1000
Jan
2015

 

By Amy Hinote

Tansler Raises $1.3M for Vacation Rental “Reverse-Auction” Site

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Tansler announces $1.3 million in additional funding and wins General Catalyst Award for Travel Innovation and The Most Innovative Emerging Company at the Phocuswright Innovation Summit.

“Save time. Save money. Haggle free.” That’s the promise of vacation rental marketplace Tansler which today launches after two years of beta testing with a mission to shake up the $135 billion share economy and vacation rental industries. Tansler, an anagram of Rentals,  introduces a patent-pending process that enables consumers to set their price, choose multiple homes and submit one binding offer. Owners/Managers compete for the booking through a 24-hour ‘reverse auction’ and the first one to accept the offer ends the auction and confirms the reservation. This new approach saves consumers 10 to 50 percent on more than 500,000 rentals in 150+ countries worldwide.

“While it takes minutes to book a flight or hotel, it takes hours and sometimes days of emailing, haggling, and waiting to book a vacation rental, and that’s unacceptable,” said Jeremy Bernard, CEO and Founder of Tansler. “At Tansler, we set out to improve the process for both sides of the transaction. The result is that owners/managers are delighted to receive the entire, non-refundable payment at the time of booking, while the consumer enjoys big savings and quick booking.”

 

Tansler name your own price for vacation rentals
 
Patent-Pending 24-hour Reverse Auction

From the beginning, Tansler shakes up the vacation rental search by asking users to name their own price. Travelers can provide preferences for location, dates and number of guests. Those looking for destination inspiration, can search the world of Tansler by date and price only.

Tansler searches its database of 500,000 properties in 150+ countries worldwide and provides a set of search results that meet the user’s criteria. Tansler displays the listed rate of each property alongside the renter’s offer and discount off the listed price.

Next, users select as many properties they like, provide a credit card to guarantee the booking and Tansler does the rest. Instantly, selected properties receive the offer with a 24-hour timeline to accept. The reverse auction ends when the first owner/manager accepts the offer, or after 24 hours.

All transactions on Tansler are binding for both renters and owners/managers, and there is no cost for hosts to list their properties or for renters to bid on properties. Once a booking is complete, renters are charged a six percent service fee and owners/managers are charged a three percent service fee. The service fees are at or lower than other vacation rental and share economy websites. Listings on Tansler are also non-exclusive, so owners can list properties on other websites and with real estate brokers.

 

Winner of Two Awards at Travel Technology’s Biggest Conference

Tansler won two awards at the annual Phocuswright Travel Innovation Summit, held on Nov. 17 and 18, 2015 during The Phocuswright Conference. Each year, innovative companies are selected to demonstrate groundbreaking applications and solutions that are set to change the travel industry. The winners represent the best of this elite group. Tansler was awarded:

  • The General Catalyst Award for Travel Innovation, which comes with a $100,000 convertible note
  • The Most Innovative Emerging Company

 

Tansler Milestones Since Beta Launch

$1.3 million in additional funding including Karlani Capital and a number of angel investors including Ken Hamlet, Former CEO of Holiday Inn® Hotels; and B Anthony (Tony) Isaac, extended stay pioneer and co-founder of Lodgeworks. Tansler has raised $2.1 million to date.

500,000 vacation rentals in 150+ countries worldwide. Inventory comes directly from global Property Managers, Property Management Software companies and partnerships with leading vacation rental websites.

 

New hires to executive team:

  • Walter Buschta (COO) – a vacation rental veteran and e-commerce entrepreneur who is the former CMO of Interhome, the world’s largest vacation rental property management company
  • Daniel Ortiz (CTO), PhD in Material Science and Engineering; former CTO of Makr, sold to Staples earlier this year

TripAdvisor lowers manager fees and adds traveler fee

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Today TripAdvisor implements a new fee structure for vacation rental managers bringing parity to their pricing model for vacation rental listings.

Yesterday, TripAdvisor sent an email to property managers that their fee would be lowered to 3% with an additional traveler fee for guests booking vacation rentals through their websites.

This move is welcome news to property managers who complained in an open letter to TripAdvisor CEO Stephen Kaufer that said, “Properties that are professionally managed are being charged a significantly higher commission (10%) than those that are owner managed (3%).  This practice makes no sense and, if anything, managers should get a discounted rate since they list in bulk and are business partners…Please let us know if TripAdvisor is willing to offer Property Managers the same 3% pricing model on the ‘Pay on TripAdvisor’ as TripAdvisor offers rent by owners with 5 properties or less.”

 

TripAdvisor Commission Announcement
Dec. 8 TripAdvisor Email to Vacation Rental Managers

TripAdvisor initiated a traveler fee for owner-managed properties earlier this year imitating Airbnb’s pricing model which proved that travelers are willing to pay an additional fee for bookings. Last month HomeAway announced they would be also adding a traveler fee for reservations. Priceline’s Booking.com has not implemented a fee for travelers for vacation rental bookings.

According to a Skift article written by Dennis Schaal, “TripAdvisor’s introduction of a traveler fee on vacation rentals by property managers will not necessarily be material to TripAdvisor’s financials in the short term because vacation rental transactions are not material to TripAdvisor at this juncture. But those traveler booking fees could be material to TripAdvisor in the future.”

Schaal continued, “TripAdvisor’s decision to begin charging travelers’ a fee for vacation rentals from property managers will please Wall Street and could put pressure on Booking.com, which adamantly eschews such fees for all of its vacation rentals, to do likewise. On the other hand, much as HomeAway saw a competitive advantage for years in not charging a traveler fee while Airbnb and others did, Booking.com management could stick with its beliefs and continue to avoid turning off consumers with booking fees.”

 

By Amy Hinote

A Tribute to Milton Buehner: One Who Epitomized Innovation, Integrity, Passion, and Servant Leadership

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“I can do things you cannot, you can do things I cannot; together we can do great things.” –Mother Teresa

This quote was often used by Milton Buehner and summarizes the paradigm he used to create Buehner-Fry in 1987, the company we know today as NAVIS.

“You can’t have walked through the history of vacation rentals without acknowledging Milton Buehner,” said industry veteran and revenue management consultant George Volsky.

Milton Tobias Buehner was born August 31, 1938 in Mitchell, South Dakota. After graduating from St. Johns High School in Winfield, Kansas, he served in the Navy from 1956 to 1959. He then built and ran several businesses, but during the recession in the 1980’s, Milton’s entrepreneurial life took a downward turn.

In his own words, Milton Buehner, whom his friends simply refer to as Milt, said in a 2012 interview with the ministry Generous Giving, “At the time we were living in a 21 foot camp trailer after having lost three different businesses, and I looked around in my camp trailer and out the window in the junk yard that we had to park that in, and I realized that whatever plan He had for me had to be somewhat better than the one I was living in. God provided everything. He provided the idea for a business that had to do with telecommunications.”

 

Milton Buehner – His Plan Had to be Better Than This from Generous Giving on Vimeo.

 

And what a business it became.

 

The Foundation

According to Larry Browning, President at Discover Sunriver Vacation Rentals, “Our company was Milt’s first ‘client’ way back when. Milt always referred to us as clients because clients -as opposed to customers -were folks that you cared for, helped and nurtured. The business started by providing an Amway phone – that oughta give folks my age a chuckle – that would allow long distance calls to be made from the vacation home and transfer those charges to the guest as opposed to having them show up on the owner’s bill. Believe it or not, this was a big deal in the 80’s. Buehner-Fry would take some profit, and their plan allowed for the property management firm to take some profit.”

Al Williams, Owner of Cabin Fever Vacations in Gatlinburg and previous President at ResortQuest SW Florida, added, “Prior to Milt introducing the phones, property managers had to hold a guest’s damage deposit for up to two months in order to receive the phone bill from the owner and deduct the charges from the guests deposit before returning the balance. His introduction of the phone to our industry helped solve a major problem for all vacation rental managers.”

Steve Fine, who joined Buehner-Fry in the early stages while the company was operating out of a garage, said, “We spent a lot of years trying to figure out how best to help the hospitality business. In hindsight, at the company we were simply living Milton’s core values with a little technology thrown in. We lived them so much they merely became who we were.”

 

Growth

In describing the company’s growth, Browning explained, “The use of the phones grew, and services expanded. Buehner-Fry developed a housekeeping monitoring system allowing us to track the comings and goings of our housekeeping teams and also help with the scheduling. They developed speed dial buttons that local vendors such as the pizza delivery and bike rental companies could buy into. Soon after, the service morphed into “free” long distance calling for the guests which was a really big deal! You need to remember at that time we were all still tied to land lines. Around this time they introduced temperature sensing devices that enabled us to monitor temperatures from our desktop…another big deal.”

“In the early years of my time at Buehner-Fry there were no core values written on the walls and taught to new employees, no strategic planning and barely any meetings of note,” said Mike Hollibaugh, Chief Innovation Officer at NAVIS, who joined the company in 1998. “There was just a way that we all conducted ourselves that mirrored the way Milton Buehner conducted himself. We were expected to act a certain way and treat our clients a certain way, and it was never even really spoken to or about. That’s just how we did it at this little company in Bend, Oregon that provided long distance service to Vacation Rental Companies.”

Steve Fine added, “Following the Golden Rule, always having integrity in anything we did or said, being innovative – it is so much fun, having a passion to help others succeed, and an attitude of being able to do what is necessary for success is who we had become.  By helping others, we always help ourselves in the long run.”

 

Change

With the introduction and widespread use of cell phones and web-based technology, many of the products were in danger of becoming obsolete. While several companies shut down with the introduction of new technology, Milton Buehner worked directly with his clients and his team to innovate and find better technology to improve the operations of vacation rental managers.

According to George Volsky, “As cell phones threatened the business, Milt began an exhaustive and relentless search for new products and services. He explored new ideas and spoke to everyone. Milt leveraged his company’s expertise in phone systems to accomplish what I believe to be the industry’s most remarkable transformation from one business to another. He laid the foundation for NAVIS’s current suite of products and services which today extends well beyond vacation rentals to hotels and resorts.”

Larry Browning said, “Milt surrounded himself with really good people and built a culture that I and tons of others trusted. They gained our trust by asking us about our businesses and applying what they learned to provide products that would help and nurture our businesses. I have fond memories of lunch with Milt and seeing his eyes sparkle when he talked out about his visions of what could be.”

Browning continued, “Then the big changes came. These guys figured out a way to provide us information about our guests that before, was only available to large corporations with huge budgets for market research. All of a sudden we were able to monitor calls coming into our offices, track those calls, get a profile of the caller, create a data base of the caller and break that data base down into finite groups allowing us to spend our marketing dollars more efficiently. Narrowcast! I remember when Milt was explaining the Narrowcast concept to me and that sparkle in his eye appeared bigger than ever. He used several analogies from broadcast, as in radio or TV, to fishing, to mining to explain the concept to me. ‘What if we can take the information we have and find that pocket, that sweet spot, that vein of gold that had been overlooked before? What if we can coach our employees to fine tune their skills to enhance even more, our ability to capture more business?’”

 

Handing Over the Reins

In 2006, Milton Buehner turned over the reins of the company to his son Kyle Buehner. George Volsky said, “Milt knew when it was time to hand the reins over to others. He exited to focus on other interests, enabling his son to build upon the original foundation of expertise and capital.”

In the 2012 interview, in his own words Milton said, “He (Kyle) is carrying it on partly because his values are similar to mine. And he watches me like a hawk so it isn’t so much by what I say, but what I do. And I believe he understands who is the Provider for our ideas. What that is doing is meeting mine and Donna’s fondest expectations, which are that we have the opportunity to find a home for what God gave us.”

Mike Hollibaugh said, “After we had moved away from long distance and became a software company and the company was rebranded as NAVIS, we began to start doing things like strategic planning, exploring our purpose and deciding on our core values. Although Milton wasn’t at the helm when we did these things, it is astonishing in retrospect how he shaped each of our values that are now posted on our walls, including the Golden Rule, integrity, innovation, passion and attitude.”

Browning added, “I think it’s important for folks to understand the transformation that Buehner-Fry/NAVIS went through. It’s nothing short of amazing. Think about it, the business was built around a piece of hardware and technology that is obsolete today. It would have been so easy to say ‘we had a good run’ and that would have been the end of it. What NAVIS did was totally transform from what they started out as to something that is totally different today. The cool thing is every step they’ve taken is relevant to all of us in the Vacation Rental business.”

 

Impact

John V. Kjellman, President, and Victorex, Inc. and founder of the Vacation Rental Managers Association (VRMA) said, “Milt’s big impact on the vacation rental business was in the products and services he made available to vacation rental managers, and the way in which he evolved his business over the years as technology and business practices changed. His impact on the vacation rental industry was huge.”

According to Browning, “NAVIS and others such as First Resort Software (FRS) really helped build the VRMA. While the idea thankfully stemmed from another visionary, John Kjellman and a handful of his clients, NAVIS and FRS saw the importance of our industry getting together as well, and they aggressively encouraged us to join this new group. Every new client they gained was encouraged to join the VRMA. NAVIS has been a supporter of the VRMA ever since I have been involved, providing financial support, hosting seminars and classes, acting as cheerleaders for the organization and gathering and providing data about the industry as a whole.”

Kjellman added, “I can’t think of a single person who more influenced the ‘industry,’ over a span of many years than Milt. I’m happy to take credit as the VRMA founder, but I was simply the spark that got things rolling, it was the folks like Milt who developed the industry into what it is today, and while there were many significant contributors along the way, I can’t think of anyone who tops Milt on the list.”

 

Legacy

Michelle Marquis, VP of Sales and Marketing at NAVIS, said, “At NAVIS, we get a piece of Milton every day. His vision for our company permeates how we interact with our clients and with each other. People that never met Milton Buehner won’t even know that we got that from him, but in the way we grow as a company, Milton’s mission, his values and his passion live on in everything we do as an organization. He’s still here.”

Larry Browning attended Milton Buehner’s memorial service. “Milt had an impact on folks from all walks of life. Neighbors who met ‘this smiling man who always waved as he walked by their home on his morning walk’.  NAVIS employees ‘who sincerely and honestly knew that a piece of Milt would always be with them.’ Former NAVIS employees who appreciated the fact that he was a part of their lives and remembered his office did not have a door, recovering alcoholics that ‘couldn’t have made it’ without Milt. Missionaries from Uganda and Mexico that have been able to help hundreds upon hundreds of orphans and widows because of Milt and Donna’s support, a Naval honor guard, business associates who Milt helped succeed, church members, restaurant staff from places Milt used to get breakfast and of course the family and close friends. I think one man put it best when he said, ‘I thought I knew Milt, but after being here and listening to all of you today I know I only knew a small part of the man.’”

 

 

In his own words Milton Buehner said, “I believe that you can be a generous giver without having a lot to give. If you have a heart that follows God’s direction for you, you are a winner if you obey his commandments. I don’t believe God is at all impressed with the numbers. I believe with all of my heart that God is impressed with obedience and blesses obedience.”

Speaking for the employees at NAVIS, Hollibaugh said, “The one thing Milt taught us all was servant leadership. Our employees and our clients are under our care and protection, and our job is to serve them both with grace.”

 

by Amy Hinote

Is it Time to Change that Property Management System? Changing Technology Providers: What You Need to Know 

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VRM Technology Survey

By Doug Macnaught, The VRM Consultants & TomK, The VRM Consultants –Companies have a variety of reasons why they decide to change Property Management Software (PMS). If you can’t think of at least three, then maybe now isn’t the time to change. In the majority of circumstances your existing system will be like a pair of nicely worn-in shoes. You know you might not be able to sprint after a bus, but they are pretty good for wearing all day long.

You see and hear about all the shiny new things that are out there and available and think that you cannot compete unless you have them as well. Whether it is cloud based systems, dynamic pricing, mobile housekeeping, or just the next evolution to integrated accounting and tighter security, knowing that now is the correct time is the most important thing to decide before you embark on the process.

  • Do you have the staff resources to select and change software?
  • Are you prepared for the pain involved to change/migrate systems?
  • Do you have the budget?
  • Will you need a new website or new productivity tools, and can you afford these?

These are just a few of the questions that you should ask yourself before even considering to move forward with the selection and implementation of a new PMS system.

Few decisions you’ll ever make will have as much impact on the operation, profitability, and overall success of your business as what PMS you’ll use for the future. You need to do everything in your power to ensure you select and implement correctly.

 

The Four Pillars of a Successful Software Change

 

Consider the four pillars as equal contributors to the success of your project. Each represents a corner, and if any is weaker than the other the whole will probably fail.

1. Understanding

2. Analysis     

3. Selection               

4. Implementation

 

1. Understanding Your Business

The first part of the process is to completely understand your business and the people that make it a success. It is essential to listen to all the people that make up the company and not just those that can get their point across in the most vociferous manner.

Using a non-partisan, data gathering approach to the process is the best methodology in establishing your business needs. You should look deeply inside every aspect of your company to determine how you do business and produce a document (spreadsheets are best) that concisely describes what each part of your operation needs or wants from new software.

  • Start with each department head and have them monitor the existing system uses during a regular day, week, or month. You must understand what the system does or doesn’t do for you at all points of your business.
  • Log every Feature/Activity/Process and be sure to note whether this is a Must Have feature or a Would Like feature as far as the department is concerned.
  • Prepare a spreadsheet with the Feature/Activity/Process details from each department and consolidate the data in a logical flow by Department/Business Area. This becomes your Needs Document.

This should be a lengthy iterative process. The more data points that you collect, the less you will be surprised later on down the road. Include each person that is a stakeholder in the process. You will need their input and assistance to get through the process and have a successful transition.

 

2. Analyzing Your Needs

Once you understand how your business interacts and falls short with your existing systems, then it is time to analyze the results and determine the importance of each aspect.

  • Establish the stakeholders. They may be your C Team, your department heads, or just the people you respect that should assist in the decision making process.
  • Make sure everyone knows that this is not a democracy and that they are not going to get everything they want.
  • Send a copy of your Needs Document to all your stakeholders and have them rank the importance of each item in the document (irrespective of whether they operate in that area of the business or not).
  • Make sure there is a place to mark the Must Haves. If your business depends on this feature, then it is crucial to keep this to the fore.
  • Once complete, collect the information from each person and overlay the responses into the columns of your spreadsheet. It is essential to know how highly each stakeholder ranks each aspect.
  • Develop the Final Company Ranking of each aspect. Using a scientific weighting system is preferable, but no matter how you arrive at your final ranking, it is crucial that it reflects the true level of importance of each aspect to your company.

Meet with the stakeholders to review, explain, and adjust your final Needs Document. This should be a spirited meeting – the last chance for the shareholders to lobby for their priorities! This meeting is also where you get complete “buy-in” from all your stakeholders. Once the priorities are decided upon, they all need to commit to them as a team. It is now or never for you to get the correct level of commitment for the next two additional phases of the project. If you need to review and revisit, do so now.

 

3. Selecting Your Next Partner

The selection process is the most difficult phase to navigate because the information that you need to make your decision is not in your control. The vendors will not want to expose their weaknesses and will try as much as possible to paint a positive slant on features. (That’s not a bug, it’s a Feature!)

It is crucial that you approach this process with your eyes wide open and firmly fixed on the task at hand.

Separate this process into four stages: Search, Review, Negotiate, and Decide

3.1 Search —Return to your Needs Document and create a smaller initial Request for Information (RFI) that deals with the most critical requirements that you have. Review the software companies to see which ones meet your core criteria. As there are at least 25 different software vendors in our space this will require significant effort, but it is a worthwhile and necessary effort.  In many instances the initial review process will narrow down the list of potential vendors quite quickly, for example:

  • If you need real estate commission approval.
  • If you must have distribution links to a particular channel or partner.
  • If you require access to your native data.
  • If you want to have your system in the cloud.

You must be dispassionate about the search. At this point in the process you are not selecting your system, you are preparing a shortlist. Focus on how your business operates. Do not be swayed by the things that do not matter:

  • It is not important how shiny their booth was at the tradeshow.
  • You wouldn’t buy a house based on the restaurant your realtor took you to, so don’t buy software that way either.
  • Don’t assume! Things change very quickly in this business and what was true last month is not necessarily the case today. Reach out to see what they offer today.

 

3.2 Review —Ideally you should be able to narrow the field of prospective products to no more than three. This is a good number and you should expect to invest a minimum of a day on the initial review of each system.

Send out a much larger RFI to the three that you select, and make sure you include as many of the details as you can. This will help the vendor decide how best to demonstrate their systems and give them a good idea of how serious you are in the process.

Decide who your demo participants are, they could be all the stakeholders, or just a subset. No matter what you decide make sure every one of them sees at least their focus portion of the system from each vendor.

It is very important that each person get the same information from each demonstration. You don’t want to give an incomplete picture to anyone. Do not go ahead with a demo unless all the demo participants can be present for all demos.

The vendors will want to use the demo to highlight the features of their product that pop, those that help to sell their product. You need to focus the vendors on showing you how their product addresses the core functionality or Must Haves that your team has identified.

Rate the vendors on their responses and demos of the items that you identified in the initial phase. You have to be dispassionate and even-handed in your review, so don’t think badly of the vendor if you don’t like their tie or perfume. And don’t think more of them because they took you somewhere nice for lunch. At this stage it is all about their product. (You might think this is obvious, but you’d be surprised…)

Nominate at least one person to be involved in all the demos and collate the scores from the participants. This will be crucial when you come to the final review.

 

3.3 Negotiate — You should already know the business model each vendor is offering from the RFI they responded to. This will enable you to get a rough idea of what the costs will be.

Be sure to gather all the costs involved in the process. It may not be enough to simply get a good deal on the system. Don’t neglect the other costs involved:

  • What is involved in changing my website? This can often be the largest additional cost and one that is often overlooked.
  • How much is the cost of Training and Implementation? What’s included and what is additional?
  • What are the ongoing costs of Support and Services?
  • Are there any hosting costs?
  • What about your existing IT infrastructure? Even if the system is hosted in the cloud, what are the costs likely to be to upgrade your infrastructure?
  • Will your data be converted? What will the vendor convert? What will you need to manually convert? How much time and resources will you need to devote to review and double entry?

Knowing all this information will allow you to make the most informed decision and know the true cost of the process.

Cheapest isn’t always the best and neither is the most expensive. This is where you should negotiate the best price you can. Note that price should be a consideration, but you also need to consider the overall reduction in operating costs and increase in productivity that the new system may bring.

 

3.4 Decide — Once you have all the pieces in place, decide which vendor you are going to move forward with. The following should act as a guide to help with that decision:

  • You will not find a vendor that gives you everything you want. Be prepared to compromise, but do not lose sight of your Must Haves. 
  • If you can’t see it, you can’t use it. If you have a feature that you need and the software company promises to provide it in the future, make it part of the contract now or you may never see it.
  • Review all aspects of the vendor from best match on your features to price and your confidence in their company.
  • Get references, talk to your peers, talk to their clients.
  • Make sure all the stakeholders are on board. If you set the expectations correctly at the beginning, each may not be getting their favorite system, but it must be good enough to justify the change.
  • Expect to spend at least 20% of the system cost on Training and Implementation.

 

4. Implementing for Success

The final part of the process is as critical to the success of the project as any of the other three. Do not minimize the investment in training; a poorly trained staff will destroy a successful software change quicker than anything.

  • Nominate a project manager from your staff to manage the project for your company.
  • Require the software vendor to give you a single point of contact and set up regularly scheduled meetings and calls to monitor progress both weekly and after key milestones.
  • Ensure there is a written implementation plan. This can come from the vendor or from you, but it should include all aspects of the process from setup to data conversion to training and go live dates.
  • Make sure dates are assigned to all milestones, and track those dates. Consider attaching penalties to missed targets.
  • Don’t forget to include your external critical systems if they integrate to your PMS. What is the lead-time for them to change to your new platform?
  • Expect to pay overtime to your staff during the process. In most cases, you are not adding to your staff, but they will be required to do their existing jobs as well as attend training and do data entry or double entry during a parallel switch over.
  • Practice, Practice, Practice – make sure that your staff know your new systems and run mock sessions so that they can handle the system under pressure.
  • Do not convert financial data! Expect to enter and verify it manually.
  • Open a new bank account. This is essential in certain states and advisable in all installations. Balance the money between both systems and transfer that amount into the new account. What is left over is what you have to reconcile to your old system but will not impede the successful balancing of the new one.
  • Review and measure regularly. Get help from your software vendor if you start to fall behind. They do not want you to fail! It is not in anyone’s interest for that to happen.
  • Communicate, Communicate, Communicate! It is impossible to over-state the value of regular communication:
    • Internally with your whole team to quickly see where the project is succeeding and failing.
    • Externally with your software vendors and other people involved in the process.
    • Finally with your homeowners, vendors, and incoming guests. Let them know you are changing; they may cut you some slack.

 

As can be seen, each of the four pillars is an intricate, complex, time consuming process. The level of success of any pillar is dependent upon the successful completion of the previous pillars. You should seek as much assistance as possible to ensure this success.

When selecting your team, consider working with someone who has extended experience in PMS selection and migration projects and has intimate knowledge of the numerous PMS products available. Between the complexity, scope, and impact of these projects, having people on your team who have “been there and done that” is invaluable.

Q&A with Carl Shepherd, Co-Founder, Chief Strategy and Development Officer and Director, HomeAway, Inc.  

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Tucked in the fast-paced heart of downtown Austin, HomeAway’s World Headquarters occupies the corner of 5th and Lamar. Just forty-eight hours before his final day at HomeAway, I sat down with Carl Shepherd to ask about his thoughts on the vacation rental industry today, his predictions for the future, and to find out what is on the horizon for the entrepreneur-in-residence.

His office shelves were bare, empty of books, files and memorabilia. Half-packed cardboard boxes filled the room. The smooth desktop was devoid of its owner’s belongings. I was immediately struck by the thought: The idea of Carl Shepherd retiring from HomeAway is surreal.

It is impossible to imagine what the vacation rental industry would look like today without the influence of Carl G. Shepherd.

Carl Shepherd Retires from HomeAwayHomeAway launched in early 2005 by Carl Shepherd and Brian Sharples. As Chief Strategy and Development Officer, Shepherd engineered the company’s acquisition binge. During HomeAway’s first two years of operations, he quarterbacked the purchase of eight leading vacation rental marketplaces including TripHomes, A1Vacations, GreatRentals.com, CyberRentals, Rent101.com, Germany’s FeWo-direk, the UK’s Holiday-Rentals, and the U.S. flagship site VRBO.com.

Since that time Shepherd has initiated and completed acquisitions of top vacation rental online marketplaces throughout the world and helped to lead HomeAway to a successful IPO in 2011, resulting in the company becoming the number one vacation rental marketplace in the world. Not bad for a 1970 graduate of Woodrow Wilson High School in Dallas.

 

Q: What trends do you see impacting the way the vacation rental industry is shaping up today?

CS: Right now there is a euphoria surrounding all things associated with the sharing economy. As a result there’s a lot of new inventory coming into the market. At HomeAway 95% of our rentals are second homes primarily in vacation destinations with more than two bedrooms; by contrast, 95% of Airbnb’s listings are primary residences in urban centers, and more than 75% of those are rented, not owner-occupied, one bedroom or less apartments or simply a room. What this means is today there’s more inventory in a whole lot of urban markets which has resulted in a lot of younger, millennial travelers experiencing alternatives to hotels.

This creates an interesting conundrum. As an industry, how do we differentiate what we do from someone’s apartment, complete with his underwear in the hamper, and food in the refrigerator? At HomeAway, we like the notion of privacy and ownership, we like the traveler to feel like the home is theirs while they’re on their stay, not someone else’s home they’re camping out in. The experience of staying in a dedicated, private vacation home versus the experience of staying in someone’s personal residence is very different.

Second, there is a generational shift; people now expect to do everything online. This is having a real impact on owners and property managers who have been in the business for a long time. Today, 30% of travelers have stayed in private homes as opposed to less than 8% when we started HomeAway in 2005. That means the audience for vacation homes has more than tripled during the age of online transactions. Many owners tell me that they don’t believe travelers want to book online, but Booking.com has proven that travelers instantly book a private property if given the chance. It’s clear to me that the traditional vacation rental provider will have to move to online booking in order to survive. Our strength has always been a high degree of customer satisfaction due to our selection, and that has been good for us and the owners who use us. But in the future we’ll see both large selection and instantly bookable homes. Owners who won’t accept online bookings will see intense competition from those who will. Right now our competitors don’t have many individually-owned, second homes. We may see that change.

Travelers are driving the industry in this direction, not HomeAway, not Airbnb, or Booking.com. Demand drives all industry. Owners who ignore what the traveler is demanding do so at their peril.

At HomeAway, we believe part of our responsibility is to prepare owners for a future they may not see coming. Rapid change in the industry will continue. There are going to be many more options and lots of competition, and when we inevitably see the vast majority of private homes become bookable online we want our owners to be ready.

 

Q:   What was your most challenging acquisition at HomeAway?

CS: Australia’s Stayz. I wanted to buy it in 2005, but I was ten days late in meeting the owner and he had already committed to sell it to Fairfax. Luckily for us, Fairfax eventually decided to divest itself of Stayz. We had the opportunity to purchase it in 2013, but because it was the last crown jewel in the vacation rental industry, a bidding war developed. It took eight years to buy that company and the last 24 hours took 10 years off my life!

Stayz did not rely on a subscription model. Their business model was essentially pay per booking on the honor system. It worked in Australia, but can you imagine that working here? We still have not integrated the site into the HomeAway technology.

 

Q: When you look at what is coming in the vacation rental industry, what are your predictions?

CS: First, I predict what I call the “Revenge of the Property Manager”. Over the next few years we will see property managers, as we say in Texas, in the cat-bird seat.

Screening guests, managing credit card payments, arranging for housekeeping, differentiating properties, all the related tasks and services that travelers expect are getting harder and harder to manage for individual home owners. This is occurring at the same time that new and progressive property managers (PMs) are looking to re-invent the property management business model.

Even though there will be a big opportunity for professionals, yesterday’s property management methods are going to have to adapt. I foresee PMs will find new revenues by opening up their models: accepting inventory that is available for less than a full season, offering a la carte services while dropping the base percentage fee, providing only housekeeping supervision, etc. I see room for full-service options, but I think that will work best for high end homes where the owner is willing to sacrifice his margin for his lack of involvement.

And I foresee a new emphasis on the PM’s brand. We’ve all heard people wax poetic about the word brand at vacation rental conferences, but I don’t think it’s been done in a way that benefits the VR professional. Brand, for a vacation rental manager, cannot be sustained if you don’t have repeat guests. Today PMs need to piggyback on larger brands that can reach new travelers, and then double down on providing the best service to inspire repeat guests and direct word of mouth bookings. For example, PMs often maintain a set of inventory that ranges from one to five stars. They need to ask, “What do my properties say about me? Am I putting 5-star travelers in 3-star properties? And if I do, why would they come back or recommend me?” They can also learn to use sites like HomeAway to bring new people to them who are the best match for their property: when they do that, their brand will benefit.

 

Q: What has driven HomeAway’s slowdown in acquisition?

CS: Our scale has changed. For an acquisition to be meaningful today it has to be much larger. We have acquired the world’s largest vacation rental marketplaces in every country where the industry is fully developed. For the emerging markets in vacation rentals, there are not market leaders yet. They are still trying to build up industry and they are not yet profitable.  

For example, VRBO.com founder David Clouse reached profitability, not because he had venture capital to burn, but because he and Lynn didn’t spend more than they made. In today’s world, small companies need a lot of money to get started to buy traffic, attract supply, and differentiate themselves from many well-funded competitors, so few have reached a profitable state. The money is spent on getting big, fast.

In acquisitions, we are now looking at what can add value to our customers. Instead of outright purchases, we’ve invested in companies that add selection for the traveler such as: TravelMob (Singapore), CanadaStays (Canada), HemenKiralik (Turkey), Bookabach (New Zealand) and Tujia (China).

 

Q: What was the most surprising challenge you faced during the rapid-growth of HomeAway?

CS: The most surprising thing, and frankly one of the biggest hurdles, was discovering the Hatfields/McCoys relationship between professional property managers and owners back in 2005. The level of distrust between For Rent By Owners (FRBOs) and PMs took Brian and me completely by surprise and delayed the consolidation of the industry – exactly what travelers wanted – by years. It wasn’t until we acquired Escapia and Instant Software that we could tackle this problem head-on, and I think everyone – owners, PMs, and travelers – have benefited from the unification of the industry.

 

Q: What is next of the horizon for Carl Shepherd?

CS:  All retired people grapple with how to be involved, but not consumed as I have been over the past ten years. I’m hoping to find that balance. I remain on the board of HomeAway. I’m also an angel investor in several companies in our space, including TurnKey Vacation Rentals and OnceThere.com, a marketplace for vacation activities. There’s a lot of opportunity in the activities industry, and, in a way, it has similarities to the vacation rental industry. I also plan to do a little traveling myself. With the relationships I’ve formed with our homeowners I would like to stay in several of the properties we market on HomeAway.

Most importantly though, is our youngest son, Jack, who has Down syndrome. My wife Suzanne and I are very active in efforts to educate parents and help families understand intellectual disabilities so that they can help their children reach their full potential. Jack graduates from high school this year and even though we’ve been involved in learning how to help children with intellectual disabilities find their place in the adult world, it is much more urgent now that Jack is an adult. Can you imagine the poor guy who hires Jack and gets me as the work-coach?

 

Q: What do you consider your greatest accomplishment while building HomeAway?

CS: Most people will talk about the way HomeAway enabled the world to see the size and scale of the vacation rental industry, and the way we introduced this type of travel to a larger, worldwide audience. But what I’m most proud of are the men and women who have found careers here, the families that we enabled to have a great quality of life, the children that just keep coming and the future they represent. It’s the families I’m proudest of and the families I’ll miss the most.

Carl Shepherd has succeeded in understanding the vacation rental industry and all of it eccentricities. He found a way to bring together, on a common platform, owner-managed and professionally-managed homes. Thus, he helped create a marketplace that offers travelers the largest selection of vacation rentals on the planet. While we can expect to see Shepherd pop up from time to time to add insight and experience that will help further the industry, his consistent, full-time presence and strategic direction at HomeAway will be direly missed.

We wish him well in this new stage in his life, and we find ourselves most grateful to have participated in one of his final interviews as a vacation rental industry pioneer.

It may be one of the best times to sell a vacation rental management company, but are you ready?

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By Greg Herr, Weatherby Consulting — It has been an exciting few years in the Vacation Rental Management Industry and the next few years look to hold as much, if not substantially more, prospects for growth and success. An overall improved economy, low interest rates, and an increased awareness in the Vacation Rental Management space has led to many significant acquisition transactions. The industry and, more importantly, well-managed companies within the industry are clearly recognized as stable and profitable ventures. At the same time Vacation Rental Management Companies face new and increasing challenges that are applying significantly more pressure to their ability to run a successful and increasingly profitable operation.

Does this environment of acquisition activity and increased challenges for independent Vacation Rental Management Companies mean it is time to consider selling? The simple answer might be YES, but are you prepared to maximize your net proceeds and exit the business successfully? The answer to this question, it is as much about the current industry environment, the business you have built, and just as importantly, the process you leverage in considering an acquisition. Let’s dig deeper into all three…

 

Market Conditions

Clearly an improved economy has benefited the travel industry as a whole. Occupied nights are up significantly and average rental rates continue to improve and increase on an annual basis. Visibility and recognition for the Vacation Rental Industry, as a whole, also continues to grow which has led to new found popularity among companies looking to invest or increase their holdings in the industry. As mentioned, vacation rental operations are increasingly seen as a stable and profitable venture when reasonably managed.

These economic and industry specific factors have led to a significant increase in acquisition activity and will continue to drive substantial buyer interest for profitable and well run independent Vacation Rental Management Companies. The increase in demand makes now an excellent time to capitalize on a sale and secure a successful exit strategy.

 

New Pressures

Running a successful Vacation Rental Management Company can be as challenging as ever. Business owners are felling these pressures in the form of new technologies, new business models, additional regulatory scrutiny, increased operational costs, and increased marketing expenses. At the same time, the challenge to acquire and retain rental owners is more competitive than ever. As expenses continue to increase, certain revenues are not increasing at a commensurate rate, creating a need to financially manage at a more granular level.

 

Talking Tech

Of course, technology is playing a larger and larger role in the day-to-day operation of Vacation Rental Management Companies. Never before have there been so many solutions to enhance revenue, mine data, and market to past and potential guests. New products and integrated solutions for property management software, customer relationship management and responsive web technologies give Vacation Rental Managers (VRMs) the power to operate on the cutting edge, but at a cost. Ben Edwards from Weatherby Consulting states, “Many VRM’s are behind the curve relative to new technology. Incurring the capital expense to purchase and incorporate the often necessary upgrades can be daunting. In some situations, this may drive an acquisition transaction where the buyer has already implemented newer technology and can onboard additional inventory into their platform fairly seamlessly.”

In addition to new technologies that drive and improve the overall business, there is an increased necessity to be in compliance with enhanced security measures. Of course, you need to accept on-line bookings, but are you fully Payment Card Industry (PCI) compliant and prepared for a cyber-attack on your data? The days of tape charts and hand written registration cards have been gone for years, but in our new cloud based reality what does it cost to protect you, your owners, and your guests?

 

New Models

As always, the internet is both the best thing and the worst thing at the same time. As stated previously, Vacation Rental Management Companies have more internet based technologies available to them than ever before, but on the downside cutting edge internet based solutions and new stripped down business models allow easy entrance into the market place. Owners that turn to self management often apply downward pressure on rate integrity while forcing traditional full service Vacation Rental Management Companies to be more competitive on commission rates.

 

Rash of Regulations

For years, typical Vacation Rental Management Companies have been the stewards of following the rules while new entrants and entirely new business models have flown under the radar. In an effort to ensure the full collection of sales, lodging, and other applicable taxes local, regional and state authorities have become more aggressive when it comes to short-term rentals. In addition, local officials are feeling the pressure from primary home owners to “control” situations such as excessive occupancy, parking, trash collection, and other issues. Again, Ben Edwards from Weatherby Consulting states, “I’ve noticed an increase in regulations, and the costs associated with those increases, throughout the industry. Whether it is restricting rentals to a minimum of monthly stays in parts of California to reducing the availability of parking in beach markets of Florida these additional regulations can hurt revenue while increasing costs.”

 

Increased Operational Costs

Everyone has felt the pinch over the last number of years and we all know the drill. Costs are rising, and as the unemployment rate drops, operators are forced to increase wages to attract and keep good employees. The cost of supplies and services provided by vendors are also on the rise. At the same time, commissions continue to remain static, or worse, may even drop in certain competitive landscapes.

 

Increase in Marketing and Distribution Costs

New technologies have brought an almost endless array of paths to reach potential guests, but the costs to access these paths can be staggering for a Vacation Rental Management Company utilizing older technologies. Leveraging responsive web design is critical in delivering content across all platforms, but most importantly mobile platforms. In May of 2015, Google officially announced what we all knew was coming – more web searches occurred on mobile devices than on desktop computers. Fully responsive websites with integrated booking engines bridge the device gap but can come with a premium price tag. Even with responsive tool sets, the cost of Search Engine Optimization and Search Engine Marketing continues to grow. Not only have the Search Engine Marketing costs increased, in general, with an increase in market specific competition, but new forms of SEM have been added to the mix. Rebranding display ads that provide impressions and conversions throughout the relevant Google Display Network are becoming more effective and a necessary way to stay with, or ahead, of the pack.

The squeeze is also felt from the distribution side of the business. The largest and most effective channel partners continue to push for higher net rates or larger commission structures. While 10% to 15% had been common place for these distribution avenues in the past, 20% to 25% is becoming the standard. All this leads to a significant increase in the cost of acquiring a guest.

 

Getting & Keeping Owners

As these pressures build, it seems one of largest challenges operators face is obtaining and keeping quality rental owners and their rental properties. Not only do Vacation Rental Management Companies have more options, paths, and opportunities via new technologies so do owners. It is easier than ever for an owner to “jump ship” in favor of listing based self management or a hybrid of listing services and reduced local services. This forces operators to consider reduced commission rates or adjustments to the services they provide.

 

Are You Ready to Sell?

Chances are you built your Vacation Rental Management Company from the ground up with ample amounts of sweat, long days, and more lost weekends and holidays then you can count. Understanding why you may be interested in selling is the first step, and maybe the hardest, but if you are sure then applying a strategic plan is critical. At this point, it is highly recommended to seek the help of a transaction advisor that is intimately familiar with the Vacation Rental Industry.

 

What is your Vacation Rental Management Company Worth?

Ben Edwards with Weatherby Consulting has facilitated many acquisition transactions in the Vacation Rental space and says the help a consultant can provide often is the difference between a good deal and a bad deal.

Edwards explains, “There certainly is a list of critical items to address. Creating a grounded and sound market valuation for the business based on past financial performance is key to a successful start to the process. Having the proper non-disclosure agreements and a confidential offering package to articulate the value, culture, and story of the business brings the best potential buyers to the table. Understanding the differences in closing options in relationship to your goals ensures the transaction will meet your needs.”

Establishing an accurate valuation and offer package involves many elements. Edwards continues, “Having a top-tier financial package certainly makes a difference, and taking the time to normalize the financials of any expenses unrelated to the direct operation of the business can result in a large increase in the purchase price. In my experience, most Vacation Rental Management Companies have a very compelling story relating to their success. It is imperative to tell that story. It is also important to take the emotion out of the transaction and allow the advisor to secure the highest value for the business possible.”

Valuations are most often based on multiples of EBITDA making a solid presentation of normalized financials critical to obtaining the best purchase price possible.

 

The Art of the Deal

The difference between a good deal and a bad deal is often understanding your goals and the possible options. Ben Edwards explains, “There are generally three types of Vacation Rental transactions in today’s market: 1) Transactions that involve all cash at closing; 2) Transactions that involve a material down payment with guaranteed cash payments, plus interest over a set period of time; and 3) Transactions with an amount paid down and payments tied to some form of operating metric or earn-out over time. Transactions with purchase price payment terms similar to type 1 and 2 are the best course of action for Vacation Rental Companies. When an earn-out or contingent payment is involved, all of the risk lies solely on the Seller.

Taking that amount of risk is not prudent, as it clearly favors the buyer, creating a heavy handed scenario, while leaving Vacation Rental Company owners with significantly less value.

 

Should I Stay or Should I Go?

Of course the most obvious factors in this decision are financial. Is the purchase price appropriate and are the closing terms favorable and acceptable? Will the offer satisfy your financial goals for the next phase of your career or retirement?

However, in considering an offer to sell, you should consider all factors including non-financial factors. As an example, how will the business be managed moving forward and how will current staff be transitioned? Are you ready to move on and let go of the business? Often times aligning with a buyer that shares a similar business philosophy and vision for the business will provide the seller with the peace of mind to move on.

Indeed, it may be one of best times to consider selling a Vacation Rental Management Company and with the assistance of a trusted, experienced, and knowledgeable transaction consultant and a sound strategic plan, maximizing your net benefit is certainly within reach.

Takeaways from OPMA Fall Executive Summit

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The Onsite Property Management Association (OPMA) held its Fall Executive Summit Nov 17-18 in Tampa, FL. This forward-looking conference addressed a multitude of high-level topics and opportunities for onsite rental property managers representing the hybrid condo hotel lodging sector.

OPMA is made up of onsite rental property management companies and provides education, advocacy, and the promotion of the value of the rental experience through onsite property management companies.

 

Key takeaways from OPMA’s Fall Executive Summit

 

Jeruel Photography  www.JeruelPhotography.com ©1. Know the impact of your business on your economy.

Dr. Steve Morse, Economist and Director of Hospitality and Tourism Program College of Business, Western Carolina University College of Business, presented a “How-To” session on determining an OPMA member company’s economic impact.

Morse said, “Every property management company should know their economic impact and should have these numbers available at any given time. It is imperative that you make a conscious decision to show your economic impact to community leaders.”

Morse identified four metrics that a vacation rental manager should know:

  • Spending Created
  • Jobs Created
  • Worker’s Paycheck
  • Taxes Generated

Dr. Morse, working in concert with one of the OPMA members, produced a beta test model in a major vacation rental market which was presented at the Summit. Morse demonstrated how to use business intelligence, in combination with numbers from the CVB or State Tourism Department to determine the impact, including number of nights, average size of party, average stay length, and average daily rate.

 

2. There are new tools to help communities identify illegal vacation rentals.

New technology is emerging to help communities identify and penalize rogue vacation rentals who are not paying taxes or complying with regulations. Vacation rental industry veterans Jim Olin and Micah Berg have developed map-driven technology that provides enforcers with workload and process management.

According to Olin, “The percentage of rent-by-owner vacation rentals that are in violation is substantial, in the double digits in most destinations.”

The software platform allows investigators to identify non-compliant rentals, track their investigation process and monitor ongoing activity, communications and progress.

 

3. Hotel brands are starting to understand vacation rentals.

While the AH&LA attempts to discredit vacation rentals as a credible lodging option, several mammoth AH&LA members are moving toward a deepened understanding of the vacation rental industry.

According to a presentation given by OPMA member Kevin Groff, Vice President of Corporate & Strategic Development at Wyndham Exchange and Rentals, the U.S. vacation rental market generates $22.8 billion in revenue, and the European market represents $57 billion. Groff also presented a timeline of the acquisitions Wyndham has made in the vacation rental space.

Other major hotel brands are also investing in the sector or are look for ways to leverage the channels. Hyatt recently invested $40 million in London vacation rental company OneFineStay, and CEO Mark Hoplamazian said, “From our perspective, we’ve looked at this whole sharing economy dynamic as a broad consumer issue and the consumer behavioral change, and we’ve always been drawn to it…This is going to be a part of how people travel.”

Extended Stay CEO Gerry Lopez observed, “Airbnb could become a distribution channel just as much as it could a competitor.”

Even in Marriott’s recent announcement of its acquisition of Starwood, both the New York Times and Marriott CEO Sorenson cited the growing online home rental marketplace as a major factor in the decision to consolidate.

In addition, both Priceline and Expedia have made sizable recent investments into growing their vacation rental business pointing to the concept of marketing to the complete traveler.

Priceline CEO Darren Huston said, “In terms of the vacation rentals incremental or not, our general belief is, first of all, it’s one customer. And either a customer is just a consumer or they’re a business person and a consumer. And they take a number of trips every year, and every trip has a different rationale. And if somebody is a hotel booker on three of their trips, they may be on a trip with their family and become a vacation rental booker. We want to be able to provide all of those instances and all of those scenarios through Booking.com, so they become comfortable with that, rather than in the past, they feel if I need a hotel, I go to booking, and if I need a vacation rental, I go to company X, Y or Z.” (Read more of Huston’s comments)

 

4. Vacation rental managers can earn more business by adopting a 3D approach to the traveler.

In a session on the future of vacation rental marketing, John Dalton, Chief Marketing Strategist for OPMA, spoke in depth about marketing the experience over the property.

Dalton said, “The supply side is trying to sell a product, while the guest is trying to buy an experience.”

Dalton presented research demonstrating how the travel experience is viewed by the traveler in three stages:

  • Anticipation of the vacation
  • The actual vacation
  • Memories of the vacation

His findings showed that more focus was spent by the traveler in the anticipation and memory stages than in the actual vacation. Marketers can leverage this opportunity by finding ways to build loyalty in the anticipation and memories stage, including trickling value added services in the anticipation stage, and memory-based, guest-centric messaging post-vacation.

 

5. “Trust” is key in securing future vacation rental guests.

With the influx of shared accommodations in the marketplace, trust is becoming a bigger factor for travelers in their decision to book a vacation property.

“Guests don’t book because they’ve never tried a vacation rental, they don’t trust a vacation rental or the process, and they don’t know what to expect,” said Dalton. Communication of professional management, safety and security is key going forward, and there is opportunity to differentiate the services OPMA members provide consumers by promoting:

  • 24/7 service
  • Safety
  • Security
  • Online Booking
  • Credit Card Payments
  • Travel Insurance

Dalton added, “The currencies of the future are differentiation, targeting and value-added service.”

 

The summit also addressed customer relationship management, guest surveys, and loyalty programs. The next OPMA Executive Summit will be held in May 2016 with the specific venue and dates yet TBA. For more information on joining OPMA, go to http://theopma.org.

 

By Amy Hinote

LeisureLink partners with Springer-Miller

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LeisureLink™ today announced a new partnership with Springer-Miller Systems, Inc. (SMS), a cross-platform, guest-centric hospitality management systems.

The integration offers SMS clients direct access from their SMS|Host Hospitality Management System to LeisureLink’s global distribution network of top online travel channels like Expedia, Booking.com, and Priceline as well as all the major GDS players and travel sites to maximize bookings. Users of SMS will be able to activate LeisureLink as a channel partner to build and manage their property listings and distribute data to the LeisureLink network. LeisureLink will automatically receive property details including descriptions, amenities, photos, availability, bedroom data, rates, and nightly restrictions. Each time information is updated, the new content streams from SMS|Host to LeisureLink. This two-way integration enables LeisureLink to pass guest data, including travel dates, back into SMS|Host.

“Springer-Miller is thrilled with the expanded capabilities the integration of LeisureLink with our SMS|Host Hospitality Management System will bring to our clients,” said Victor Vesnaver, Senior Vice President, Sales and Marketing for Springer-Miller Systems. “LeisureLink presents the broadest array of lodging channels targeted at the specific market our clients serve.  The vacation rental market is hungry for access to customers like ours, and we are eager to assist them in maximizing their revenue potential and exposure.”

With access to 80 million visitors per month, LeisureLink is the preeminent vacation rental technology leader. The company is a recognized industry pioneer, with a full suite of next generation online connectivity tools including yield management, booking engines and distribution to enable vacation rental managers and owners to maximize bookings online, offline, anywhere.

Julian Castelli, CEO of LeisureLink noted, “LeisureLink offers a suite of proprietary services and technology that are a perfect fit for SMS customers. Vacation rental channels reach a different audience than traditional OTA’s, and the commission structure is more favorable to the property managers, increasing margins and profitability. By leveraging our extensive industry experience and best-in-class systems capabilities, we are confident the added exposure will keep them ahead of the competition and generate more business.”

Wyndham signs deal with Booking.com

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Wyndham Vacation Rentals recently inked a global distribution agreement with Priceline’s Booking.com. Per the deal, Wyndham’s vacation rental brands will use the Booking.com site and apps as distribution channels for its properties.

This deal comes at a time when rapid technological changes and evolving consumer preferences – as more guests book hotels and vacation rentals online – are making it necessary for hoteliers to invest in technological upgrades.

Customers typically take a cross-platform approach in travel, with most starting out on their mobile devices and completing the booking process on larger screens. This is where Wyndham Vacation Rentals stands to gain through Booking.com. All the brands of Wyndham Vacation Rentals will be available on the same platform making it convenient for guests to book their stay.

Some brands of Wyndham Vacation Rentals have already been working with Booking.com over the past couple of years in Europe and the new deal would further cement the partnership. Through the new agreement, Wyndham Vacation Rentals would be able to drive higher occupancy for its brands by leveraging Booking.com’s huge customer base. Further, Booking.com provides a good platform for Wyndham Vacation Rentals to promote its brands globally.

 

See more at: http://www.zacks.com/stock/news/199599/wyndhams-vacation-rental-signs-deal-with-bookingcom#sthash.SWXogpnF.dpuf

NEVRMA set to begin Dec. 7 in Portsmouth, NH

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The New England Vacation Rental Managers Association (NEVRMA) Meeting kicks off Monday, December 7 at the Sheraton Portsmouth Harborside Hotel in Portsmouth, NH. Atlantic Vacation Homes, OldCape Sotheby’s International Realty, Franconia Notch Vacation Rentals, Seaside Vacation Rentals and other vacation rental managers will come together to discuss issues facing vacation rental managers in New England.

Topics include short term rental advocacy and how the VRMA is addressing the needs of its membership, advancements in technology for managers (i.e. Floor Plans, Inspection Companies, Book Now, Docusign), and industry laws and how they are changing.

In addition, vacation rental managers will discuss online bookings (including reviews and listing sites), industry trends and benchmarks, business models, travel insurance, branding, marketing trends, reservations, lead management best practices, and incentivizing reservations agents.

Registration is still open, so if you would like to attend, please contact Carla Hemmings at Carla@oldcape.com to register. The cost is $50 for property managers and $400 for suppliers.

 

 

 

 

 

 

LiveRez hits milestone with 1,000th software customer

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LiveRez and iVacationRental

Eagle, IDLiveRez.com announced today the addition of its 1,000th customer.

“This is a historic day at LiveRez,” said LiveRez CEO Tracy Lotz. “Our strength is not only in our team and our software, but also in each individual partner. This milestone represents the collective efforts of the entire LiveRez community.”

The milestone adds to a banner year for the company. In just the past 12 months, LiveRez announced a real-time integration with Airbnb, won the Boise Chamber’s Travel Industry Excellence Award, and launched significant software enhancements at its annual Partner Conference in October.

The accomplishment also comes at a pivotal moment in the industry. Two weeks ago Expedia announced its $3.9 billion acquisition of HomeAway, which owns HomeAway Software for Professionals, LiveRez’s largest competitor.

In contrast to many of its main competitors which have grown through mergers, acquisitions and consolidation, LiveRez’s growth has been 100 percent organic. This growth has also outpaced it competitors, as LiveRez reached the 1,000 partner milestone in less than 8 years.

“With our new software enhancements and the HomeAway acquisition, our phones are ringing off the hook,” Lotz said. “We have been signing up new partners at a record pace.”

LiveRez also announced the conclusion of its “Race to 1,000 Challenge.” In the run up to adding its 1,000th partner, LiveRez donated 1,000 Thanksgiving meals to the Boise Rescue Mission. LiveRez then challenged their partners to offer 1,000 random acts of kindness before it hit the milestone. Partners, vendors, and friends of LiveRez responded with more than 3,000 acts of kindness. As thanks for the participation, LiveRez determined it would double its donation to the Boise Rescue Mission, for a total of 2,000 meals.

“In order to pay it forward, we put out a lofty challenge, and our partners responded in a big way,” Lotz said. “We’ve been blessed to partner with amazing companies from all across the globe, and without them our rapid growth would not be possible.”

Vacation Rental Managers in Paris Face Unprecedented Challenges in Wake of Night of Terror

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Vacation rental industry veterans are familiar with disaster preparedness. Hurricanes, fires, and other weather-related incidents have had dramatic impact in many vacation rental destinations around the globe. In addition, Mexico has confronted safety concerns and travel alerts, and other areas have seen travel drop off from anxiety surrounding ebola and SARS.

But nothing prepares a vacation rental manager for a tragedy like the one which hit Paris Friday night. Even after the events of 9/11, while air travel declined drastically and travel-related stocks plummeted, in 2001, there was no Airbnb, and professionally managed vacation rentals in urban areas such as New York City, Washington D.C. and Philadelphia did not exist.

Vacation rental managers Madelyn and Phillipe Willems, owners of Paris Perfect, Susan Doull, owner of Commendable Rentals, and Marie Pistinier, owner of Paris Be a Part of It, faced an unprecedented industry challenge this weekend and did so with grace and compassion.

Paris vacation rental managers face challenges after terrorist attack“Since last Friday we have had a 24 hour team in place to reach out to and ensure that all of our current guests are okay -thankfully, yes -and to answer questions from upcoming guests,” said Madelyn Willems at Paris Perfect. “In addition our social media team posted helpful links to information resources for guests who wanted to contact the local embassy and other useful resources.”

Susan Doull, owner of Commendable Rentals, said, “Yes, I did have guests in Paris, who were, fortunately, not in harm’s way, nor were any of the Commendable Team there. We did let existing guests stay on in the case of a cancelled flight, but cancelled flights were few, and delays were short. I have been touched by an outpouring of concern from clients and friend past and present who have expressed their concern.”

Paris vacation rentals open after bombingsDoull added, “Though one would expect that the events of Friday might deter bookings to Paris, I have been heartened to see Paris Bookings still coming through from Americans, who understand that life goes on by continuing to promote freedom and our lifestyles, by carrying on. For those who are considering or nevertheless, hesitating to book a trip to France, Commendable Rentals does offer ‘Cancel for Any Reason’ travel insurance through Rental Guardian, which will allow peace of mind, if they do change their mind after booking. I hope that those who love Paris, will show their support by visiting.”

Proactively reaching out to future guests, Willems said, “We’ve seen only a handful of cancellations. In fact, most guests and upcoming reservations have responded that they are looking forward to their stay and feel reassured about the increased security.”

Susan Doull addressed the situation, “It is a heart-breaking to see and hear of all the young lives snuffed out on the very streets where they lived. This kind of evil terror strikes at the hearts of all of us, which is of course what was intended. Parisians are brave and proud, and have made a statement of continuing on, just as Americans did after 9/11 and as Bostonians did after the Boston Marathon, etc. Giving in to Terrorism is just what the Terrorists want us to do. That is why they choose sites where Parisians gather to socialise and relax; a stadium, restaurants, and a concert hall. Or where Americans go work, or run in a Marathon. And why the will pick different sites and probably a different country or city the next time. As we know from 9/11, staying home or travelling, presents equal risks.”

Willems echoed the sentiment, “We are deeply saddened by the barbaric killings in Paris last week. It has brought about such a heartfelt response from our guests, our staff, our friends and our Parisian neighbors who collectively share their love for the City of Light and deeply empathize with all of the people and their families who have been impacted. The response has been nothing short of remarkable, and the streets of Paris are filled with a newfound resolve and appreciation for each other.”

Willems added, “France will stay strong and prevail.  And Paris will remain perfect.”

 

By Amy Hinote

Marriott to acquire Starwood for $12.2B

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Reuters with CNBC – Marriott International will buy Starwood Hotels & Resorts Worldwidein a cash and stock deal valued at $12.2 billion to create the world’s largest hotel chain.

Starwood shareholders will receive 0.92 shares of Marriott Class A common stock and $2 in cash for each Starwood share held, the companies said Monday.

The offer translates into $72.08 per share for Starwood, a discount of about 4 percent to the stock’s Friday close. (Get the latest quote here.)

Arne Sorenson, Marriott’s CEO, told CNBC’s “Squawk Box” on Monday that company officials were “dissuaded” at first. “But as the months went by, we saw a relative shift in the values of the company, so it made it more attractive economically, and we became convinced that there was more value that could be created with the two companies together.”

 

Starwood shareholders will also get about $7.80 per share from the spinoff of its timeshare business and the business’s subsequent merger with Interval Leisure Group.

Starwood, the owner of St. Regis and Sheraton hotel brands, had indicated in April it was considering strategic options.

The company had reached out to potential bidders InterContinental Hotels Group, Wyndham Worldwide and sovereign wealth funds in July.

Before Friday’s close, Starwood shares had fallen about 14 percent since April 29, when the company said it was exploring strategic alternatives.

The deal is expected to close in mid-2016, the companies said.

Expedia to purchase HomeAway for $3.9B: Vacation Rental Managers Begin to Weigh In

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HomeAway and Priceline Lead the Market

Today Expedia announced that it will acquire HomeAway for an estimated $3.9 billion in cash and Expedia common stock, representing a per share price for HomeAway shares of $38.31.

Simultaneously, HomeAway announced it will be adding a variable “traveler fee” adding approximately 6% for guests for all online transactions.

According to Expedia CEO Dara Khosrowshahi, “Our welcoming HomeAway is a winner in two ways. First, it brings industry leading vacation rental brands, traffic and unique inventory to the Expedia family. All of us have witnessed not only the incredible growth of the sharing economy, but also the substantial growth of alternative lodging in particular. Last year according to PhocusWright, one in four U.S. travelers went to private accommodations for their leisure travel. We’ve been very clear that the next chapter of our growth is supply bed, and we think HomeAway will accelerate that growth in the fastest growing segment we see out there.”

Khosrowshahi continued, “Second, HomeAway has been undertaking a challenging transition that Brian will talk about. That of a listing based model to an online transactional marketplace. The HomeAway team was working on this challenge on a stand-alone basis, but together we believe we can get there much faster and with greater certainty. As many of you know, we’ve been working with HomeAway for some time and very much respect their capabilities and -at the same time -are super excited about working together under a single corporate umbrella.”

Listen to the entire conference call. 

 

Brian Sharples added, “This will allow us to –one – aggressively accelerate demand growth for our suppliers, and –two – reinvest in products and services with a particular focus on making HomeAway the easiest to use and most trusted marketplace for vacation rentals in the word, all while accelerating revenue growth and margin expansion for the business. And the potential to do this is huge because our current take rate today is roughly 1/3 of that of our major competitors. So as a result, today HomeAway announced separately some important business model changes and though the specifics are still to be finalized, we do plan to introduce a traveler service fee in mid 2016 on transactions through our platform. Because we will begin rolling this out in Q2 and over the balance of the year, we characterize 2016 as the transition year with more notable impact in 2017 and beyond.”

Sharples continued, “In a transactional business, conversion is king, and optimizing conversion is a relatively new muscle for HomeAway, but an area where Expedia has tremendous capability. Given our industry leading booking volume even small changes in conversion should yield significant financial benefit.”

Read Dennis Schaal’s interview with Expedia and HomeAway CEO’s 

 

Key points from today’s Expedia/HomeAway call:

 

  • The vacation rental category is the second largest category of lodging behind hotels with an estimated global market size of almost $100 billion.
  • HomeAway will facilitate an estimated $14-16 billion in annual bookings in 2015.
  • HomeAway currently has 1.2 million whole home rentals in 190 countries.
  • HomeAway’s goal is to have all listings bookable online by the end of 2016.
  • HomeAway will roll out its “traveler fee” in Q2 2016.
  • HomeAway intends to increase its take rate from 3% to 8-10%.
  • HomeAway is not eliminating its subscription model.
  • The Expedia partnership is expected to increase demand for vacation rentals, increase inventory in urban markets and provide tools for optimized conversion on the sites.
  • HomeAway will continue to run out of Austin as a stand-alone platform under the Expedia umbrella.

 

Vacation Rental Managers Weigh in on Impact of an Expedia-Owned HomeAway:

 

T.J. Clark –CEO, Turnkey Vacation Rentals (700 properties)

“The changes coming from HomeAway will benefit PMs and owners that are focused on conversion.  As Dara K said on the call, ‘Conversion is the machine that makes everything else go.’  Listing rankings based on your paid subscription tier will be replaced with ranking based on listings that perform the best in terms of conversion. It will favor those who are using technology and process to have the best performing listings in the HomeAway marketplace.  And of course while HomeAway is big, the future opportunity for homeowners will be even bigger given the Expedia visitors that will be directed to HomeAway or see their listings more prominently displayed on the Expedia family of sites like Hotels.com. Homestays will be going mainstream in the travel marketplace which is a huge opportunity for owners, yet will need a more competitive approach that ever to succeed.”

 

Steve Milo –Founder, Vacation Rental Pros (1,100 properties)

“The new marriage between HomeAway and Expedia will bring new opportunities and unexpected surprises for professional managers in the Vacation Rental industry,” “The opportunities include true global distribution of vacation rentals using the best practices of HomeAway with the worldwide distribution expertise of Expedia. The surprises could include higher costs to property managers in more competitive advertising areas, spin-offs or sales of certain assets, brands or divisions, and personnel changes.  But, considering the marriage has just consummated let’s hope that it is a win-win for Expedia, property managers and HomeAway employees.  This positions four powerful well-funded companies in the vacation rental space now with Expedia, TripAdvisor, Airbnb, and Priceline all attempting to compete for supply in the core vacation rental resort market.”

 

Scott Breon –CRO, Vacasa (2,500 properties)

“Expedia’s acquisition of HomeAway is fantastic news for the property management industry – it opens a tremendous channel and opportunity that would not be possible otherwise. It is a smart move on HomeAway’s part to push ad costs to the consumer, due to the unique management contract structure of the PM industry. Spreading the booking cost between PM and Renter will enable HA/Expedia to further invest in new initiatives and capabilities that are not possible at lower margins and lowers the barrier of entry for PMs. I expect over the next year that the combined entity will see leaps in growth of customer acquisition and conversion of those customers, which is a win for HA subscribers. The increased demand from the combined company will increase achievable nightly rates and utilization – especially in smaller markets that lack hotel inventory on the Expedia platform. Urban destinations, fly-to markets, and international traveler hotspots will also see wins as hotel booking platforms are the primary path for those customers. The PMs that will be negatively impacted over the next year are those that are not instantly bookable and those that drive their customer base through SEM.”

 

Ben Edwards –Manager, Newman-Dailey Resort Properties and President, Vacation Rental Managers Association (VRMA)

“I’m excited about the opportunity this holds for professional vacation rental managers as such a large international travel company becomes more invested in the vacation rental industry.”

 

Steve Trover, CEO, All Star Vacation Homes & CSO, LiveRez 

“Predictably various managers have come out in support and ever excited about the prospect of this acquisition. While we too feel the increase in exposure of our industry could be a positive we think the industry is forgetting what has happened thus far. For starters Expedia has had vacation rentals on their website for many years. They have tried to introduce VR to consumers in many ways and each has failed to do anything other than produce more cost for the manager and owner. There has been no significant demand creation.

“Secondly we are forgetting what happened to hotels. They were enticed by the apparent demand that the aggregate shopping experience provided only to find out that it did not increase demand but only served as a major toll booth between the hotel brands and their customers. Costs continued to escalate until some of the chains attempted to fight back and pull out only to find that they had no power despite having thousands of hotels, large marketing budgets and major brands attached to them. How can we look at this and think that our industry will see a different result? How does the individual manager think they can fight against the inevitable massive increase in cost that is coming?”

 

Julian Castelli, CEO, LeisureLink

“This both 1) demonstrates that this industry is important to the major travel players, and 2) is another piece of evidence that it is going to be a more mainstream option for travelers. I predict this will accelerate growth for the industry. I  also think this is going to be a big step in bringing the industry into the modern e-commerce era. HomeAway was moving in that direction, and I see Expedia’s capabilities in this area as a big driver for the deal. After all, if their platform is good enough to power Orbitz and Travelocity, why not HomeAway’s as well? While Property Managers often prefer the listing model, I think consumers definitely prefer the convenience of e-commerce. This combination will accelerate the industry’s move in this direction.

“As for channel management, if my second statement is correct, then the need for up to date rate, availability, specials and content is going to increase, and that will increase the demand for good channel management solutions in the vacation rental industry. LeisureLink has enjoyed long and strong partnerships with both HomeAway and Expedia, and we congratulate both of our partners on this historic deal. We look forward to working with both of them to grow the vacation rental industry and their offerings in the space.”

 

PM Questions About the Purchase

Questions circulating among vacation rental managers regarding the impact of Expedia’s purchase of HomeAway center around the following:

  • Will Expedia retain or spin-off HomeAway’s software division?
  • What will a “Traveler Fee” mean to bookings?
  • Will our distribution costs go up?
  • Will we stop getting data from inquiries?
  • (For software clients) With access to our database, will Expedia market to our past guests?

 

By Amy Hinote