What Is a Corporate Rental? An Overview for Hosts

Key Takeaways:

• A corporate rental is a fully furnished, temporary accommodation designed to serve business travelers or others looking for temporary stays.
• Corporate rentals offer higher income, longer lease terms, and reliable tenants, making them a profitable STR investment.
• Airbnb hosts targeting corporate renters should prioritize location, high-speed internet, flexible leases, and amenities tailored to business travelers.

What do steady income, high rental rates, and well-behaved tenants have in common? Corporate housing! Renting to corporate travelers can provide property owners with a lucrative and low-risk investment opportunity.

The professional demeanor and reliable travel schedules of corporate travelers make them ideal guests for short-term rentals (STR). If you can create excellent accommodations that businesses can count on, you’ll tap into a new, sustainable revenue stream that sees substantial returns.

Let’s talk about what defines corporate housing and how your STR business can build a corporate customer base.

What Is a Corporate Rental (Corporate Housing)? 

A corporate rental, also known as corporate housing, refers to fully furnished temporary housing designed to give business travelers a comfortable place to stay. 

Corporate housing typically caters to:

• Business travelers
• Employees on temporary assignments
• Relocating professionals
• Individuals in need of housing on a temporary basis

Why Corporate Rentals Are Profitable 

Corporate rentals boost profitability for a number of reasons:

• Corporate housing rates are higher. Corporate clients pay more for furnished accommodations near business centers. 
• Corporate rentals can also wrap utilities, maintenance, and other services into the rental price, justifying higher rates.
• Longer lease durations also help to reduce turnover and vacancy costs. 
• Corporate housing attracts reliable tenants such as business travelers and relocating professionals, minimizing the risk of missed payments or property damage.

Advantages of Investing in Corporate Rentals 

Diversifying your renter base is an excellent way to increase rental revenue, and business travelers are among the more predictable guests to host. Tailoring your rental to be somewhere people can work and stay requires fewer special amenities than, say, a beach house. 

A beach house might demand seasonal upkeep related to wind and water, regular restocking of special guest provisions like beach towels, and more vigorous maintenance to clean up sandy floors. A corporate rental, on the other hand, can more likely meet the needs of its guest demographic with a dedicated workspace, reliable internet, and a laundry room, all of which are relatively low-cost investments as a host.

Beach STR owners may benefit from reliable high and low seasons, but occupancy forecasting isn’t off the table for corporate rental hosts. Property owners in large cities can stay abreast of nearby business conferences to forecast demand for corporate travelers.

Because they cater to a more reliable tenant base of business travelers or relocating professionals, property owners enjoy:

• Reduced turnover costs 
• Minimized risks of property damage 
• Fewer missed payments
• Lower vacancy rates

Corporate rentals are an attractive investment option for consistent cash flow and long-term profitability.

Disadvantages of Investing in Corporate Rentals 

The corporate housing industry boasts some head-turning benefits, but it has its challenges. 

Some drawback with corporate leases include:

• Dependence on business cycles: Economic downturns can affect demand for corporate rentals, leading to periods of low occupancy and reduced income.
• Furnishing costs: Furnishing corporate rentals can be expensive, requiring initial investment and ongoing maintenance expenses.
• Competition: The corporate rental market is competitive, so your business model must include a strategy for marketing and management if you wish to attract and retain tenants

Understanding these challenges and risks is critical to developing a profitable corporate rental. 

Must-Have Features and Amenities 

Corporate travelers need more than just a place to stay—they need a comfortable, distraction-free workplace. Property owners pursuing this guest demographic should focus on providing a pleasant and convenient living experience. 

Here are the key features and amenities that set corporate leases apart:

1. Fully furnished: Furnished apartments save tenants the hassle of buying furniture to create a move-in ready environment. 
2. High-speed internet: Corporate tenants rely on a stable internet connection for work.
3. Flexible lease terms: Flexible corporate lease durations accommodate different traveler needs, including stays of up to a few months.
4. Convenient location: Proximity to business centers, transportation hubs, and amenities is crucial for corporate tenants.
5. Utilities included: Billing through one inclusive cost simplifies billing and budgeting for tenants.
6. Fitness facilities: Provide access to onsite gyms or partner with nearby fitness centers to help corporate tenants perform at their best.
7. Housekeeping services: Set up regular cleaning services that keep living areas clean and comfortable over the course of the guest’s stay.
8. Security features: Secure entry systems, surveillance cameras, and onsite security personnel help to keep tenants safe.
9. Pet-friendly policies: Allowing pets increases the appeal of corporate rentals for tenants with furry companions.

You can attract and retain corporate tenants and maximize rental income and occupancy rates by prioritizing the features and amenities above.

How to Maximize Your Corporate Rental Revenue 

The corporate housing industry has high standards for rentals. It’s important to plan strategically in order to maximize revenue from corporate customers. 

Here are some practical tips to boost your rental income:

Identify Your Target Market

When pinpointing ideal tenants, think about:

• Industry focus: Find out which industries need corporate housing options in your area, whether that’s corporate professionals, consultants, healthcare workers, or individuals on temporary assignments.
• Local demand: Research the local demand for corporate rentals by examining corporate travel trends, employment opportunities, and major events or conferences in your area.
• Tenant preferences: Understand your target market’s preferences and needs, such as preferred amenities, location preferences, and length of stay. Tools like AirDNA provide insights about competitor performance in your area that can tell you what to provide and how much to charge. 

You can tailor your property to meet specific needs and maximize rental revenue by identifying your target market.

Offer Competitive Rates

Tools like AirDNA can help with researching market rates in your area and pricing your rental competitively. Note that corporate rentals must be priced to be more cost-efficient than a typical hotel stay. Interested STR hosts may want to compare their pricing against nearby hotels in addition to other vacation rentals in their area.

Leverage Corporate Housing Resources

Find ways to cater specifically to travelers looking for longer stays:

• Join the Corporate Housing Providers Association (CHPA), a professional trade association exclusively dedicated to supporting corporate housing professionals around the world.
• Register your property with ALE Solutions the nation’s leading provider of technology-based temporary housing solutions for displaced policyholders and catastrophe teams. ALE Solutions steps in when they receive a referral from a policyholder’s insurance adjuster following a natural disaster or unexpected event. 
• Serve travel nurses by registering your STR with Furnished Finder, a database that helps travel nurses and other traveling professionals find monthly furnished rentals. Approved Furnished Finder properties are cross-listed on their website as well as Travel Nurse Housing. Furnished Finder also has stats on travel nurse demand by city and state, allowing you to see city-specific travel nurse hiring trends and which hospitals in your area employ travel nurses.

Provide Exceptional Service

Provide a full-service solution for your tenants by keeping your rental in good repair and responding promptly to guest issues. Happy renters and the positive reviews that they leave are a great way to encourage repeat bookings and receive referrals. 

Maintain Your Property

Regular maintenance and upgrades keeps your corporate apartment attractive to tenants and commands higher rental rates.

Offer Flexible Lease Terms 

Flexible lease terms attract a wider range of tenants and can maximize occupancy rates. Rental options should address needs for short-term leases, as well as extended periods. AirDNA’s STR Data Lab podcast episode 57, Building a Property Management Powerhouse with Joe Riley, offers useful insights into the types of travelers that corporate housing serves. Joe Riley categorizes guests based on the length of their stay:

• Relocation stays (30 days or longer): Long term residents may book relocation stays if insurance companies pay for temporary housing when their homes are uninhabitable due to water or fire. Others may be moving to a new area and might need a place to stay while they house hunt. People who haven’t closed on a new home yet may also book a relocation stay.
• Traveling workers (1-4 weeks)
• Funerals (less than a week)

Leases on a short-term basis offer flexibility for guests that are traveling for a variety of purposes, whether it's a business trip or a temporary work assignment. Longer-term leases provide stability for extended projects or relocations. Offering both options will make your property accessible to a wider pool of tenants.

Furnish for Comfort and Functionality 

Opt for stylish yet practical furniture that provides both comfort and versatility. Include amenities such as high-speed internet, fully-equipped kitchens, and ergonomic workspace tools such as standing desks to meet the needs of modern corporate travelers. 

And don’t forget to stock common household items! Examples include toiletries like hand soap and toilet paper and kitchen essentials like cooking oil and basic spices. Addressing the little things is what separates standard apartments from reliable corporate leases. 

Nail Your Customer Service 

Professional providers of corporate housing must deliver exceptional customer service. Promptly responding to inquiries and tenant concerns will foster strong relationships and encourage repeat business. 

Stay Competitive with Pricing 

Monitor local market trends for vacation rentals and single family homes so you can adjust your rental rates accordingly.

Frequently Asked Questions 

What is a corporate rental?

A corporate rental, also known as corporate housing, is a fully furnished property that is leased on a short-term or long-term basis to individuals, groups, or companies. 

Are corporate rentals only for business travelers?

While corporate rentals often cater to business travelers, they also work for:

• Relocating employees
• Individuals undergoing medical treatments
• Families in transition
• Individuals without a permanent home due to home renovations or a natural disaster

How do I determine the right rental rate for my corporate property?

Research the local market and evaluate similar listings. Consider location, property size, amenities, demand, and other factors. Utilize data analytics tools like AirDNA to assess market trends and pricing strategies employed by competitors.

What are the typical lease terms for corporate rentals?

Typical lease durations range from a few weeks to several months, but they can vary depending on tenant preferences, property owner policies, and local regulations. 

How can I ensure my corporate rental stays booked throughout the year?

Your best bet is to make sure you’re offering similar amenities and guest policies as competitor properties in the area. Provide exceptional customer service and adopt effective marketing strategies, such as registering your STR with Furnished Finder and ALE Solutions.