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Short-term rental firms Vacasa, Sonder, Inspirato planning public offerings

Companies in SPAC mergers on heels of surges in demand

Short-term rental firms Vacasa, Sonder, Inspirato planning public offerings
(L-R) Vacasa CEO Matt Roberts, Sonder Co-Founder/CEO Francis Davidson, Inspirato Founder/CEO Brent Handler (Vacasa, Twitter via Francis Davidson, Inspirato, iStock)

Three short-term rental companies with plans to go public in the coming months are set to take advantage of recent surges in demand for stints at vacation properties.

Vacasa, Sonder and Inspirato are all planning on going public in the coming months, the Wall Street Journal reports. Each company fills a different niche around vacation rentals, but they all count billion-dollar valuations and plan to take the SPAC route straight to the stock market.

Vacasa, a vacation-home manager, is set to go public this year with a $4.5 billion valuation. The company, which manages the rental homes for owners in exchange for a cut of profits, nearly tripled its second-quarter revenue year-over-year from 2020 to 2021, hitting $238 million this year, according to the Journal.

The Portland-based company — which gained unicorn status in 2019 when it raised $319 million from Silver Lake — has been trending towards an IPO since January when it announced the hiring of Jamie Cohen as CFO. The former ANGI Homeservices executive has previous IPO experience.

Short-term rental manager Sonder also hopes to go public this year with a $1.9 billion valuation. The company partnered with Alec Gores’s Gores Metropoulos II for the SPAC, though its valuation has been cut from the original $2.2 billion.

The San Francisco-based startup announced its SPAC plans in April, expecting to reap $650 million in the original offering. Since then, the company has inked a long-term lease for the entire 76-key Gowanus Inn & Yard, its first Brooklyn location.

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Inspirato, meanwhile, is looking to go public in the near future at a $1.1 billion valuation, the Journal reports. The company leases luxury homes and makes them available to members of the service for a flat monthly fee.

Demand for vacation homes and short-term rentals has surged as employees take advantage of remote work arrangements. In April, demand for the rentals was 5.4 percent higher than in the same period of 2019 and 66.4 percent more than in 2020, according to AirDNA reported by Inman.

Revenue in the short-term rental sector hit $3.8 billion in September according to AirDNA, marking a 30 percent increase from two years ago.

The companies’ SPAC mergers come amid questions over the sector’s room for growth. A slowdown in the construction of new homes and competition from renters are forcing costs to be driven up, the Journal reports.

Read more

[WSJ] — Holden Walter-Warner
https://www.wsj.com/articles/vacation-rental-firms-vacasa-sonder-to-test-market-with-public-offerings-11636462800

Tags
Commercial Real EstateShort Term RentalsSonderSPACVacasa