Airbnb the ‘elephant in the room’

The State Government’s failure to find a developer for the Middleton Beach hotel hasn’t surprised local accommodation providers, who say the market has struggled for some years.

Last month the State Government conceded it had been unable to find a builder for the proposed 12-storey mixed hotel and apartment building at Middleton Beach.

However, the news didn’t shock Three Chimneys Bed and Breakfast owner Craig Dixon, who said a lot of the blame lay with Airbnb, which has hit his industry’s profitability since it came into the market in 2012.

Mr Dixon said given the state of the market, it’s no wonder the proposed 80 to 140-room, 12-storey hotel hadn’t had much interest from developers because Albany accommodation providers had been against the wall for years.

“The elephant in the room is Airbnb,” he said.

“No hotel developer is going to spend however much money developing a 100-room hotel and wanting to charge $200 a night.”

Mr Dixon said every operator in town had been affected by the rise of Airbnb, with some having to drop room prices by 20 per cent to attract customers.

It’s a concern shared by the general manager of an Albany CBD motel, who asked not to be named.

She said the online accommodation provider was making securing customers harder than ever.

“The main thing is there’s just no regulation,” she said.

“Seeing what’s happening to my other colleagues, I have to stand up and say something about it.”

She said she wasn’t surprised the State Government had failed to find a developer, given the lack of demand for traditional accommodation providers in Albany.

“They’re going to struggle to fill their rooms,” she said.

“For maybe three months of the year they may have a 60 per cent occupancy, but you can’t run a business like that.

“During the winter we just experienced, some properties (were) not even running at 20 per cent occupancy.”

Airbnb’s website claims it has 41 homes available for rent in Albany in October, ranging from single rooms to entire houses, and the company rented to more than 11,000 visitors across WA in 2017.

Last month Airbnb head of public policy Brent Thomas said the company had an important role in bringing tourists to the State.

“People increasingly don’t want to travel how their parents or grandparents did last century and, as such, maintaining the status quo or doing the same old things won’t get WA out of its tourism doldrums,” he said.

State Tourism Minister Paul Papalia and Planning Minister Rita Saffioti are understood to be working on new regulations.