AirBnB-ing It During ISE Might Be Challenge Within A Few Years If New Barcelona Mayor Has Way

June 24, 2024 by Dave Haynes

Well this could be a problem for people who exhibit at or walk the sprawling floors of the annual Integrated Systems Europe trade show in Barcelona – a move to curtail or ban thousands of vacation rental properties in the city.

In my two visits to Barcelona, I’ve stayed at a VRBO and then an AirBnB, and I will be in that AirBnB again in the new year.

As Sixteen:Nine’s German language content partner invidis reports, the newly-elected socialist mayor of the Catalan capital, Jaume Collboni, “wants to let the more than 10,000 licenses for vacation rentals expire by November 2028.”

The use of vacation rentals is so pervasive in the city more guests stayed in vacation rentals than in hotels last year. No or fewer flats available to rent for the week would increase scarcity and per-night costs at a time when ISE is on a big growth curve that could see it eclipse 100K attendees within a few years.

The rationale for going after vacation rentals is pretty simple for Barcelona and other local governments in cities that attract a lot of tourists and business travel. Entrepreneurs and property companies invest in flats or entire buildings and turn them into short-term rentals, squeezing out locals who rent rather than own residences. Increasing scarcity of long-term rental residences has led to average monthly rents going up by 50 per cent or more, which forces locals out of prime areas and can change neighbourhood characteristics when the sidewalks are filled with tourists hauling roller luggage instead of locals with baby strollers and grocery bags.

The building I stay in is among those that have largely been taken over by short-term rentals, though it is on a busy main street already lined with hotels and businesses.

This Harvard Business Review piece gets into the business rationale for turning monthly flats into short-term rentals (more revenue per unit per month) and ideas on regulation.

The potential problem in Barcelona is compounded by a construction freeze on new hotels that has been in place in the city center for several years.

The city’s landlords’ association wants to take legal action against the ban. The city is particularly attractive for short-term rental business operators because it is one of the more popular tourist destinations on the planet, especially away from what they call the winter months there. That’s why the two largest trade shows run in Barcelona – ISE and Mobile World Congress – are run during Q1, when locals might bundle up but people from countries that get real winter, like me, are walking around in shirt sleeves.

The company that organizes and produces ISE for its trade association owners, Integrated Systems Events in Munich, works with the hotel network Bnetwork to put together big blocks of rooms for the show to somewhat control hotel room prices during ISE week and not see per-room rates get wildly inflated.

Keep in mind this is a move targeted to take affect by the end of 2028, so if it happens, there is time to adjust. Also keep in mind that a LOT of entrepreneurs would have placed big bets on core businesses or side-hustles owning and running short-term housing units, and they’re not likely to just roll over and see their businesses vaporized – though I suppose they can be sold or converted back to long-term leased residences.