Just a few days after we pondered whether the clock was ticking on the sharing economy, news has emerged that European Airbnb competitor 9flats is closing down its Berlin operations. The news follows Berlin’s move to ban short-term vacation rentals in the German capital.
Now, 9flats will operate entirely from its head office in Hamburg, but this does mean that 25 jobs will be lost in Berlin, covering mostly call center operations and customer service.
Launched in 2011, 9flats has been competing with the likes of Airbnb in the peer-to-peer vacation rentals space, but company spokesman Roman Bach says that the Berlin curb was a massive blow to them. He says:
“As Germany is our home turf, Berlin is our largest market. In the past, we invested a lot of energy to support new hosts and develop the market., with profits delayed into the future. We can’t justify this investment, if the regulatory environment is so rigid. When other cities did limit vacation lettings, they usually did allow private lettings of peoples primary residence. In some cities short term lettings are allowed in certain areas. In Berlin however, everything is banned now and this leads to a lot of uncertainty with hosts.”
So while other cities do have restrictions in place, it seems that the blanket short-term rentals ban in Berlin has made the situation untenable. There is, however, a two-year transition period and there could be some wriggle-room with the law, for example there’s scope for it being restricted to certain neighborhoods only.
We probably haven’t heard the last of this, but for now 9flats is no more in the German capital.