Sell for More News is a weekly blog series with interesting information from the world of commercial real estate.
Membership based business models are all the rage…but could it work in the short-term rental business?
Landing is a membership-based firm that provides short-term furnished rentals in some of the country’s most expensive cities.
The company leases blocs of apartments from landlords including Related Cos. and AvalonBay Communities, filling the units with furniture and dishware, hooking up cable and internet and renting them out at a markup for as little as 30 days.
“Renting needs to change,” the CEO said in an interview. “The whole point of renting is to have freedom and flexibility and the way it is today, you don’t have flexibility because you’re locked into a lease. You have to move all this furniture around and do all this work and you just want to focus on your job and your friends and living your life.”
Landing joins a growing wave of challenges to the traditional tenets of renting…a movement that’s questioning why leasing an apartment requires sizable upfront costs and a commitment to stay for a year.
Co-living units, where tenants share furnished communal space, are proliferating, as are cheaper alternatives to paying a full month’s security deposit. There are even apartment buildings in which landlords explicitly allow tenants to sublease their units through Airbnb for half the year.
So far Landing has signed leases on and furnished about 200 apartments in six cities that include San Francisco, New York, Nashville and his hometown of Birmingham. Tenants pay Landing an annual membership fee of $199, which allows them to sublease any of those apartments for a monthly rental cost that’s about 10% to 13% higher than if they rented a unit directly from the landlord. They can stay indefinitely on a month-to-month basis.
So far, Landing has about 150 dues paying members, most of whom have signed leases of six months or longer. Moving requires three days’ notice. With a normal lease, it’s typically 30 to 90 days.
Unlike corporate housing, where firms are the clients, Landing deals with individuals, who might be seeking flexibility to move for personal reasons and whose jobs may be portable.
As the tenant, Landing handles all interactions with the landlord, offers concierge services and has a team of contract employees who agree to be the buffer for annoying tasks like waiting for a plumber.
Landing is focused on more mobile professionals, and people looking for freedom, flexibility and great experiences… but they don’t want to be tied down.
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About Beau Beach, MBA CCIM
Beau is a tenacious Commercial Real Estate Broker, author and adoring father of four. His clients appreciate his no-nonsense demeanor and his legendary work ethic.
Beau leads Beachwood which is a commercial real estate broker for sellers in the Nashville, Milwaukee and South Florida markets.
He’s the author of the books The 3 Reasons: Why Most Commercial Properties Don’t Sell and True Wealth: What Every Seller Should Know About 1031 Exchanges.
Beau can be reached at 800-721-3287, click to schedule a call or Beau@BeachwoodSells.com