It’s been a long road to the Airbnb IPO. The vacation rental platform has been one of the companies of the past decade, upending traditional travel real estate and commercial real estate. Subdivided homes and spare bedrooms have become informal hotels while apartment landlords have become Airbnb moguls. The COVID-19 pandemic initially dampened prospects for the company, as it did for traditional hotels. Where the Hiltons and Marriotts have languished with hard assets to maintain and mortgages to pay, Airbnb has fared relatively well. Ahead of today’s IPO the company has boosted its IPO price range aiming at anywhere between a $42 and $50 billion value.

To make sense of how Airbnb has managed to go into the IPO with strength despite this year, and what the IPO might mean for travel real estate and commercial real estate as a whole, MPA spoke with Jonathan Wasserstrum, the CEO of commercial real estate platform Squarefoot. He explained how Airbnb was able to navigate this year and what Airbnb’s survival through the pandemic could mean for the balance of travel real estate into the post-pandemic era.

“Airbnb, I think fared a lot better than anybody thought they would six months ago,” Wasserstrum said. “They did well with a lot of near travel. This summer travelling looked different, but people are still travelling and a lot of people used Airbnb.”

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Nevertheless, the whole travel industry has been hit hard this year, Airbnb included. The firm had to make widespread layoffs in 2020 but seems to have come through the worst parts of this year intact. Wasserstrum explained that while hotel chains have mortgages to pay and harder assets to manage, Airbnb is just a platform provider, their fixed expenses were easier to manage and scale down.

The nature of the properties rented on Airbnb, too, helped the company as many people began booking long-term stays in remote, scenic locations during the pandemic. Wider availability of working from home meant booking a 6-month stay at a remote cabin in Utah (with top-notch wifi) was suddenly attractive and Airbnb could provide that.

Wasserstrum also pointed out that arguably the most impacted side of the travel sector has been business travel. Much of that traffic flows through traditional hotels while Airbnb enjoys a larger share of recreational travel.

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Wasserstrum expects the IPO to go as predicted, along the lines of other tech IPOs like Palantir’s, earlier this year. He expects the offering to be hot and Airbnb’s share price to shoot up. Airbnb CEO Brian Chesky will enjoy a major milestone and his team will celebrate, but the story of Airbnb’s strength has been written in the past decade and over the course of the pandemic.

What the IPO means for mortgage professionals, though, is that while traditional hotels should continue to struggle, many properties purchased or outfitted for Airbnb are stronger investments than might be expected this year.

“For originators and underwriters, this shows that you shouldn’t be scared of the Airbnb properties which you probably traditionally struggled to get a mortgage on this year,” Wasserstrum said. “Airbnb is not going anywhere as a way of traveling. Me and three buddies and our significant others renting a five bedroom house instead of getting five rooms at a Hilton, that is here to stay. And if I’m underwriting a mortgage for that I should be comfortable with that income stream, which should give me comfort in writing that mortgage total.”