Columbus looks to regulate Airbnb and other short-term rental businesses

As more short-term lodging rental units come online in Columbus, one city councilor has asked for the staff to bring an ordinance for consideration to govern the growing enterprise.

Councilor Skip Henderson called information that could lead to an ordinance that would regulate the new lodging option.

“I want to make sure everybody is playing by same rules and its a level field,” Henderson said on Tuesday. “Others in the hospitality industry are subject to rules and regulations. It makes sense that anybody doing short-term rental like Airbnb would be subject to those same rules and regulations.”

Henderson made his request at last week’s council meeting. The Columbus Convention & Visitors Bureau has been monitoring the short-term rental business in the city for about a year, President Peter Bowden said on Tuesday.

Bowden and the Convention & Visitors Bureau are providing assistance in crafting regulations and he expects to have something for council to consider in 45 days or less.

Because there is currently no regulation, Bowden said, there is no mechanism for those offering short-term rentals to pay taxes or fees that other hospitality providers pay. The room tax in Columbus is 16 percent, with 8 percent of that sales tax that is distributed to the state, city and school district, while the remaining 8 percent is divided between the Convention & Visitors Bureau, Columbus Civic Center, trade center and RiverCenter for the Performing Arts.

“For us, it gets back to lost revenue for the city,” Bowden said. “We want to make sure it is a level playing field. We have to be careful at the CVB because we don’t want to interfere with anyone being an entrepreneur. We need to make sure the system is working for everyone.”

The primary online booking source for short-term rental is Airbnb.com

Airbnb is an online lodging version similar to the online ride-sharing apps Uber and Lyft. It terms itself a “hospitality service,” that enables people to lease or rent short-term lodging including that ranges from vacation rentals to hotel rooms. Airbnb does not own any of the places it rents, just as Uber does not own any of the cars. It is a broker and receives commissions from both guests and hosts in conjunction with every booking. Airbnb touts more than 3 million lodging listings in 65,000 cities across the world.

“This is a new form of travel and people are clearly looking for a different experience,” Bowden said.

Ernie Smallman, a real estate broker, has turned three of his Historic District rental properties into Airbnb locations since January. He is looking to convert several more units in the coming months. It is a more difficult process than just listing a unit on Airbnb, Smallman said.

“This is definitely economically driven because you make more money on the unit through Airbnb than you do with a traditional long-term renter, but it is also a lot more work,” Smallman said.

Smallman rents his fully furnished one-bedroom units for $60 to more than $100 per night.

“For me, it is almost like a guesthouse at your house,” he said. “I want it to be that level of quality.”

One of the things that drives the online books of Airbnb locations in customer comments, which are visible on the site.

Haley Lyman is a short-term rental consultant who manages properties for Smallman and others downtown and in Midtown.

“There is a lot involved in getting a unit ready,” Lyman said. “There is the design and what you want to do with the space. You have to look at what revenue it would generate in the short-term market as compared to the long-term rental market.”

Once the unit is ready, Lyman helps her owners market the units with photos and captions designed to attract renters. And in Columbus many of those leasing short-term units are connected to Fort Benning, Lyman said.

“Fort Benning is 100 percent the biggest part of the market,” Lyman said. “Many of them are here for graduations at Fort Benning. And they are coming from all over the country.”

The Airbnb locations are scattered across the city. Columbus real estate agent Bardie Brady has one unit in northeast Columbus and is working to bring a second one online in the northwest part of the city. She got into the business after staying at Airbnb properties overseas, Washington and Austin, Texas.

“Most of our business is Fort Benning families,” she said. “We have a fully stocked kitchen and many times the mother just wants to cook a meal for their son or daughter who is at Fort Benning and that is the reason for staying in an Airbnb instead of a hotel room. These people are my guests and I get to know a lot about them.”

The Convention & Visitors Bureau has found there were about 35 units being advertised on the website Airbnb.com about a year ago. A quick check this week showed about 70 units, everything from the downtown Historic District to a treehouse in the St. Elmo area. But it is difficult to get an exact read because some in the Auburn, Ala., area show on Columbus searches.

Brady, like Smallman, knows some form or regulation is coming and she is OK with that.

“We are taking such a small fraction of business from the hotels,” she said. “We really are providing a service. If we have to get a business license or pay the taxes, that’s fine.”

This story was originally published July 18, 2017 at 5:44 PM with the headline "Columbus looks to regulate Airbnb and other short-term rental businesses."