Short term rental companies can’t believe their luck. Private equity and venture capital continue to flow into their industry despite a hot market. Vacasa remained a cherished investor, in part because it dabbled in opening real estate brokerages to help boost unit supply.
Sean O’Neill, Skift
Vacasa, a property management service for short-term rentals, announced Tuesday that it has raised $319 million in investments, with funding from private equity firm Silver Lake. The vacation rental startup has now raised a total of $526.5 million in private equity funding, more than any other such startup.
The Portland, Oregon-based company said the deal puts a valuation “north of $1 billion” on the company, making it the first “unicorn” in the rental property management industry. .
“Our goal has always been to be wherever our customers want to travel, and while we’ve achieved significant year-over-year growth, there are still gaps to fill in the U.S. and internationally. “said Eric Breon in an interview. “This new funding will help propel Vacasa into our next stage of growth and allow us to deepen our investment in technology.”
Vacasa did not disclose ownership of Silver Lake with this investment, the financial terms or the valuation the investment placed on its business. Existing investors Riverwood Capital, Level Equity and NewSpring Capital also participated in the capital increase.
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Funding is one-time. This month, Vacasa completed its purchase of Wyndham Vacation Rentals, paying Wyndham Destinations $156 million in cash and $10 million in Vacasa stock. That was two-thirds less than the $30 million stake the startup in July first offered to cash-preferred Wyndham Destinations.
Vacasa expects its revenue to nearly double next year. The construction of approximately 9,000 Wyndham units will contribute to this growth.
“The integration of Wyndham Vacation Rentals homes into the Vacasa portfolio will be phased, market by market, over the next 12 months, and we expect full completion by fall 2020,” Breon said. “We are currently working in the top three US markets.”
Real estate game
Vacasa, which manages more than 23,000 vacation rentals on behalf of owners, recently opened real estate agencies in a handful of U.S. vacation rental markets to help buyers identify vacation homes as a rental investment. .
In September, Breon spoke about his company’s strategy on stage at the Skift Global Forum in New York. Vacasa has little trouble generating demand, he said, as many travelers are eager to find accommodation in these destinations.
Onboard provisioning is Vacasa’s biggest challenge, Breon said. Many property owners are not used to renting or have longstanding relationships with local property management services. The startup’s real estate efforts aim to fill the gap.
Watch the interview here:
Silver Lake has more than $43 billion in assets and investments, including Omio, the online travel booking service, FlixMobility, the intercity bus operator, and Alibaba Group, which owns the online travel agency. Fliggy line. Years ago, Silver Lake was an investor in Saber, the travel technology company, and in Qunar, the Chinese travel reservation service. Silver Lake also currently owns an interest in LightBox, which provides analytical services to help commercial real estate brokers, banks and lenders make decisions.
Vacasa said it has hosted more than 20 million room nights since its inception in 2009.
CORRECTION: An earlier version of this story incorrectly stated that Vacasa was the first unicorn in the short-term rental industry. It is the first unicorn in the rental management sector.
Register now for the Skift Short-Term Rental Summit in New York on December 5 and hear from Lisa Jurinka, Vacasa’s Chief Legal Officer