Mea culpa, or smart and thrifty PR play?
Short-term rental giant Airbnb has pledged $25 million toward the development and preservation of affordable housing in Los Angeles and San Francisco, according to the L.A. Times.
Using one metric for estimating the cost of building affordable housing, the Times estimated that $25 million could pay for just 76 new homes.
Nowhere in the state is the housing crisis more pronounced than in LA and San Francisco, and elected officials have laid some of the blame directly at Airbnb’s doorstep. Critics in both regions say Airbnb’s platform has incentivized landlords to effectively remove units from the housing stock.
Airbnb, valued at $35 billion, has fought most efforts to regulate its users’ practices, but in L.A. a restrictive ordinance went into effect in July, permitting only primary residences to be rented out, and at a cap of 120 days.
Airbnb’s pledge isn’t likely to have a widespread impact on either L.A. or the Bay Area’s housing issues, but the company called its pledge a pilot program and said it would expand its investments if the pilot program was successful.
CEO Brian Chesky said the investment program, which also includes small business loans and community investments, has “the potential to generate solid returns for our company and make communities stronger,” according to the Times.
After years of fueling rising home prices and rents in the Bay Area in particular, recently several other large tech firms have have made similar pledges. In January, Facebook pledged $500 million toward affordable housing in the area.
Google pledged $1 billion to create more housing in the Bay Area. A month later, the company announced it was providing large undeveloped parcels around Silicon Valley for $15 billion in planned communities to be built and managed by Lendlease.