New York state has made it clear that it is dubious of the p2p accommodation platform Airbnb.
Last week the state’s top prosecutor subpoenaed the company asking for the personal data of about 15,000 of its New York City residents. A few months earlier, the state tried suing individual Airbnb hosts. A spokesperson for New York was quoted as saying, “Even Airbnb admits that its customers owe taxes on apartments they’re renting out for profit.”
Today the company shot back, not in the form of a statement, but with a study. The study enumerated precisely what kind of economic impact the company is having on the city of New York. It was Airbnb’s way of proving its worth to the city.
“Hey, New York!” yells Airbnb, basically, “You think some residents aren’t paying their taxes? Well how about the hundreds of millions of dollars of revenue we’ve provided for your city?”
Presenting the data was Jamie Springer from real estate economic advising firm HR&A. At the press conference he exhibited a slew of numbers and graphs elucidating the economic support Airbnb has provided for the city of New York. According to his numbers, the platform was able to drive $632 million in economic activity, and helped support over 4,500 jobs.
What he really emphasized was the diversified impact the company has. While $632 million is an impressive number unto itself, he also explained that 82 percent of this commerce was generated outside of the primary New York midtown area where most hotels reside.
One example was my neighborhood of Bedford-Stuyvesant in Brooklyn. According to HR&R’s numbers, this neighborhood, which is anything but a tourist attraction, received $14.5 million of direct local spending thanks to Airbnb hosts.
In essence, this entire study is Airbnb’s way to respond to allegations that New York isn’t benefitting from its platform. “Oh yeah?” it is essentially saying, “Well what about Bed-Stuy? Or what about Harlem?” The jury’s still out, however, as to whether the longstanding local Bed-Stuy residents are happy about this new surge in tourism.
To really drive it all home, the company brought a local host to speak about her experience. Kimberly Kaye came to the podium and spoke about her chronic degenerative disorder that leaves her unable to work. To supplement income she hosts guests in her Manhattan apartment. This has allowed her to pay her expenses and fend off being evicted.
Without so much as saying it, Kaye implied that New York would be debilitating her personally by continuing to go after Airbnb. She implored the state to work with the company to come up with a solution. “We would be happy to pay taxes on our Airbnb earnings,” she said.
David Hantman, the head of Airbnb’s Public Policy, echoed these views saying that the company has been “eager to work with the Attorney General.” When I asked him what data the company would be comfortable handing over to the state, however, he responded with “zero.” While he is happy to work out a compromise, he does not believe that New York has a right to any customer data, especially without any hard evidence as to the extent of the damage the city sees Airbnb doing.
While the statistics are interesting, and it is good to see non-Manhattan boroughs of New York thriving thanks to a startup, this study is more a piece of theater than it is a data document. But a great piece of theater it is, and quite convincing.
The next logical question is: how will the state respond?
[Image via Thinkstock]