Although tourism has declined because of the pandemic, Vacasa, the largest full-service rental property manager in the United States, remains committed to the sector. The Portland, Oregon-based company has resumed its merger and acquisition activity.
Anticipating a possible initial public offering, Vacasa announced on Tuesday that it had hired Jamie Cohen to be its chief financial officer. Cohen worked for more than a decade at ANGI Homeservices (owner of the Angie’s List and HomeAdvisor brands), where he saw his annual revenue increase from $ 200 million to $ 1.4 billion. Cohen was introduced to the startup by Chris Terrill, Vacasa board member and former CEO of ANGI Homeservices.
“An IPO is definitely part of a possible future for us,” said Vacasa CEO Matt Roberts. “Part of the preparation is having the right people on the team with the right level of experience. Therefore, Cohen is a great addition in this regard. “
Cohen replaces Jim Grube, who joined Vacasa in July 2019 after being the chief financial officer for online pet products retailer Chewy. Grube also served as Hilton’s senior vice president of finance during the company’s initial public offering. Vacasa said that Grube “left in November 2020 to look for other opportunities”.
Would Vacasa rule out an IPO in 2021?
“I’m not going to come in at a specific time with you,” said Roberts. “The focus now is really on growing the business, supporting that growth and putting us in a position to be an independent public company at some point.”
Vacasa partially benefited from the increased interest of the American consumer in short-term rentals during the pandemic. Skift Research’s Travel Tracker showed that the share of the vacation rental market in total accommodation doubled between February 2020 and November 2020.
“There was an acceleration of this existing trend,” said Roberts. “In fact, we haven’t had much of a shoulder season in this ‘shoulder season.’ I attribute [the strong bookings] people’s ability to work and learn remotely. People decided to take a week or two at a different location and have the children study at home in the morning and then leave. “
Vacasa recently acquired Walk Away Stays from Charleston, South Carolina, and the 55 rental units it manages. In November, Vacasa acquired 45 rentals in the Jackson Hole metropolitan area, taking over the short-term rentals from Mountain Property Management.
Although small, the negotiations show that Vacasa is tiptoeing back to mergers and acquisitions in the American market. Prior to the pandemic, Vacasa led an accelerated acquisition program, acquiring approximately 40 companies a year in 2018 and 2019. The startup has raised about $ 634 million in private equity funds to date.
“Acquisitions are a big part of our business plan because they help us enter new markets or, in certain cases, substantially increase the density of vacation rentals in a given market,” said Roberts. “But it can take some time. We talked to the Mountain Property Management salesman for years. “
Vacasa said that the pace of reserves has been strengthening. On January 4 and 5, the company had two of its biggest reserve days in the past six months. Its seven-day average for new reserves is about 50% higher than the December trend.
In select markets, seasonal rental bookings were strong in the second half of 2020. In the months leading up to the acquisition of Walk Away Stays, rental occupancy in South Carolina increased 23% year over year.
The initial public offering by the booking agency Airbnb in December launched a highlight in home rentals. In its financial records, Airbnb said that most of its reservations came directly, especially after the marketing setback.
About 35% of Vacasa’s revenue now comes from direct reservations to the company’s website or mobile application. This compares to about 18% or 20% of direct reserves in 2019, the company said. The startup does not do traditional TV or billboard marketing. Most of his other marketing is done through markets like Airbnb, Booking.com and Vrbo.
Vacasa’s biggest acquisition to date was Wyndham Vacation Rentals. It announced the deal closed in October 2019 at a final price of $ 162 million. He brought the various brands to Wyndham Vacation Rentals under the Vacasa brand and its technology platform in 2020. The last part of the merger takes place later this month.
Despite the renewed acquisition activity, Vacasa is targeting the USA as targets.
“There is a lot of growth available in North America,” said Roberts. “So our focus now is on figuring out how to do it.”
Photo credit: An image of the Ocean Club 1201 Isle of Palms beachfront path, South Carolina. The property was recently managed by Vacasa, which has just entered the South Carolina market. Vacasa, manager of seasonal rental property management, resumed its wave of acquisitions and hired a new chief financial officer. Vacasa