Hostmaker parent firm “files notice of intention to appoint administrators”

UK: According to a report in the Sunday Times newspaper, property management firm Hostmaker is urgently seeking talks with new investors as it continues to struggle with spiralling losses.

The company, which is bankrolled by backers including Thai property developer Sansiri and Hong Kong real estate investor Gaw Capital, is reported by the newspaper to have generated £17 million in sales in 2017 and 2018, leading to losses of more than £20 million over the past three years.

According to The Sunday Times, Hostmaker’s parent company has “filed a notice of intention to appoint administrators at the High Court, giving it ten days to resolve issues with creditors”. The report also mentions Hostmaker saying it was in talks with “several investors”.

The London-based startup launched in 2014 under the stewardship of co-founders and husband and wife, Nakul and Deepti Sharma. Since then, it has secured $30 million [£23 million] in two separate funding rounds.

On its website, Hostmaker says it aims to deliver “thoughtfully designed interiors, smart algorithmic pricing decisions and a personal service”. Its offerings also include cleaning, concierge and photography services for listings through home-sharing platforms.

The last 18 months have brought mixed fortunes for Hostmaker.

Back in October 2018, Marriott extended its collaboration with the company as part of its home-sharing pilot, which saw Hostmaker work alongside Tribute Portfolio Homes to identify and manage a portfolio of homes for Marriott.

However, last February, an investigative journalist from the BBC programme, Inside Out London, secretly recorded staff from Hostmaker, as well as CityRelay and GuestReady, telling an undercover reporter how they can get around London’s rules regarding how long a property can be rented out for.

The capital’s letting rules stipulate that a property cannot be rented out via platforms such as Airbnb for more than 90 days a year unless they have been granted planning permission to do so.

Then, in May last year, the startup was forced to pull adverts that appeared across London’s TfL [Transport for London] network after they were labelled “misguided” for appearing to encourage buy-to-let landlords to convert their properties into more lucrative short-term lets, rather than cater for long-term rental tenants.

ShortTermRentalz reached out to Hostmaker for a response but the company declined to comment further.

For more information, visit the Hostmaker website here.