Rapidly growing vacation rental startup Vacasa has made a name for itself by managing thousands of individual units across the U.S., but today it is ratcheting its offerings up another notch: The company is now going to manage entire communities.
The new program is a full service management option for communities, such as condo developments, that are primarily used as vacation rentals. Whereas previously Vacasa contracted with individual owners to manage their units as rentals, the new service will see the company assume a broader role, operating community-wide maintenance, front desk service, and financial management, among other things.
Meghan Lutterman, Vacasa’s director of homeowner associations, said the company will take on housing communities in which at least 50 percent of the units are being used as vacation rentals. Vacasa has already taken over management at 16 different rental communities spread across Idaho, Colorado and Costa Rica. And it hopes to expand, primarily in the U.S., in 2019.
“We wanted to prove this out and make sure we were able to execute on it,” she told Inman. “Now we are ready to roll it out to a much broader area.”
Vacasa has grown rapidly in recent years. The company started in 2009 after founder Eric Breon started managing a cabin belonging to his wife’s family on the Washington coast, but couldn’t find a satisfactory management solution for the property. Less than a decade later, Vacasa manages more than 10,600 individual units spread across multiple countries.
Last year, Vacasa raised $104 million in funding and in July it launched a real estate arm that connects agents to buyers and sellers. Vacasa dove into real estate after discovering that nearly 5 percent of the homeowners who use the company sell their properties each year.
Like Vacasa’s real estate arm, the new community association management services are the product of seeing a need on the part of the company’s clients. Lutterman said owners of the units Vacasa managed would sometimes approach the company with concerns about dirty pools, cracked tennis courts, or other problems with communal spaces. But because it only managed individual units, Vacasa was in no position to solve those problems.
The new community management service is meant to address that issue.
“This is an organic offering,” Lutterman said. “Homeowners have been coming to us for some time.”
Vacasa will take over management by putting in a bid with the community’s board of directors. Lutterman said that individual unit owners have been the ones to get the ball rolling, and once it takes over Vacasa works to create a “harmonious” environment with clients who have the company managing individual units and others.
“We work with the association’s governing documents to allow all the required or requested uses,” she added.
The service has proven to be a boon to Vacasa’s vacation rental business as well, with Lutterman saying that “management of the association drives individual unit growth for us.” Many of the units Vacasa currently manages are currently located in planned communities, meaning that they could eventually fall under the association management service if the owners pushed for that option.
Vacasa COO Bob Milne said in a statement that the company decided to begin widely offering community management because the skills were “already part of our arsenal.” He also said the company’s teams were “connecting with homeowners who are expressing needs they have surrounding not only their own vacation rentals, but also those in their communities.”
Update: Vacasa clarified that Breon’s cabin was not inherited, but rather that he began managing it.