Setting up a crash pad for airline employees. Any experience?

12 Replies | Atlanta, Georgia

Hi, I just purchased a duplex in Hapeville.  I'm rehabbing one empty side now, and wonder if anyone has had experience in using an investment property as a crash pad for airline employees.  How do they work?  How do you find potential tenants?  Do you feel it was/is worth the extra effort?  Thanks

You may be able to Airbnb it with some degree of success. Just be aware of the tax treatment of short-term rentals (average rental period of 7 days or less) vs "traditional" rentals, especially if substantial services are involved. That will affect your ROI calculation.

It might be worth a "feel out call" to airlines to see if there's a list you can get put on, or if you can assist employees in any way.

I imagine flight crew employees would find a lot of value in a short-term rental near a MARTA station on the red/gold line not too far up from the airport where they can just crash for a day or two if they're stuck in Atlanta.

As a pilot who's rented at 3 different crash pads, here's how I've seen them work. There are 2 types of pads. From a crewmember's perspective, crash pads with "hot" beds means we do not get a dedicated bed in exchange for a lower monthly rate or a per-night rate. when we show up we take any open bed. Our bedding is stored in a closet or carried in and out in our bags. the bed is not our own when we are not there. There are usually more people paying/month than there are beds, but should not be so many that the beds fill up. These work in a hot market.

The more common type of pad has each customer renting their bed for the whole month, on a month to month basis. The bed is treated as their own. No bedding is provided.

While my airline does have a list of local crash pads, it isn't updated and so it's been unhelpful in my searches in the past. Word of mouth is the most common way to find a pad, followed by company bulletin boards, and then craigslist. Company bulletin boards are not accessible to the general public. 

The following is a crash course on crash pads and why we need crash pads. Usually a crash pad is an apartment or single family house with at least 3 bedrooms. Most bedrooms are outfitted with beefy bunk beds. Typically all or all but one bedroom will have 2 sets, 4 beds total. The owner may have one room outfitted with 2 regular beds which rent at a higher rate. Your market could be pilots, who make more, spend more, and will want a nicer cleaner pad, or flight attendants who are looking for more value. Some are coed, some are not. Some are pilot only, some are not. There is always a regular cleaning service that comes in (at least montly, most twice a month). They are generally next to transit. In ATL that would mean next to College park or East Point red/gold line station. 

Here is why we need crash pads. home base is the airport where trips originate and terminate. Up to half of crew members do not live "in base". These crew members "commute" to their base on empty unsold seats using standby travel or riding a small fold up seat called a jump seat. Because of the unpredictability of ticket sales, they have to leave at least 2, sometimes as many as 4 or 5 flights as options to get to work on time. 

When first starting, most sit "reserve", or on call, and must be at the airport within 2 hours of a call during a typical 14 hour call out period. This means they must be away from home in a position to be at work within 2 hours of a call. Commuters sitting in base on call usually hang out in a crash pad. After more time at an airline, a crew member may get enough seniority to hold a "line", or a predetermined schedule every month of flights to operate. These schedules are constructed of trips which vary in length from 1-5 days. The best trips for commuters start late the first day and end early the last day, precluding the need for a crash pad: as a result more senior crew will "bid" and be awarded these trips, leaving newer crew line holders and reservists to the early starts and late finish times. These crew will need to leave a day early to get to work and will need a crash pad several times a month.

If the economy is healthy and seniority movement is steady, you will always have turnover as crew will get seniority to bid trips which no longer require the pad. Most pads do not follow local code for short term housing. There is and will be drama when people are away from their families and friends confined to a bunk bed. On the other hand, if well run you can persevere and potentially collect more than market rent for a property.

I do this in Chicago.  It works really well and the cash flow can be significantly better than with traditional tenants.  

A couple things to consider:

  • This is a very niche business and connecting with your perspective clients can be a challenge if you don't have some kind of airline connection.
  • This is not passive investing.  You have constant turnover with short term rental periods.  All utilities/ cleaning/ and sometimes transportation included.  

There is at least 1 online listing service to help people find crashpads.  Which is also useful to see what's out there and assess the demand in your area.  www.crashpad411.com 

If you decide to move forward best of luck to you.  

FYI: 

I live up the street. This is not a suitable crash pad property. It wouldn’t work well  and word would spread internally and then it would be vacant and you would need to find out another use for the space.

Originally posted by @Josh F. :

If you are interested in a crashpad near the airport in Atlanta, check out this building currently on the market zoned commercial: 3196 Dogwood Drive, Hapeville, GA 30354 ... 

 

@Simone Johnson we have worked hard to set this house up on advance of a friend who was flight crew. He told us it was really needed at IAH. We worked hard the bunks are custom made and very sturdy. We wanted it to be special and better. The first 6 months we only had two people. We have had it now for 1.5 years. We had finally got to 12 people. Because we had to lower the estimated bunk rent to $220/month our break even after we had to provide weekly cleaning service and increase in utilities and increase in internet. Our breakeven was 9 bunks. So as you can see the profit margin has decreased. If the house was full it would make decent money for someone who is willing to handle the “tenant” issues. For us this was difficult. We did a remodel when we hit 10 people to change the laundry room into a 3rd full bath with shower and make the 1/2 bath a full mud room so we could have two full size washer/dryers. We added two additional refrigerators. The biggest thing we learned is that the tenants are young and not use to being on their own. Some are very entitled to not even being willing to put the trash can to the curb. This has caused us to have reduce someone rent to just drag a can to the curb. They expect us to “do” everything. We provide laundry soap, toilet paper paper towels and bottled water and weekly cleaning service. The dont clean up after their self. We had to install a camera to hold them accountable to clean up their dishes. 

I don't think it would work well in Tampa. As far as I know the only airline with a crew base in Tampa is Allegiant.  Their schedule is mostly day trips which leads to most of their crews living in their bases.

What I am saying is that you would have a very limited tenant pool and it would be hard to fill your units.  

Hey Simone,

I am interested in that area of Hapeville (for either a house-hack or a potential crash pad). Would it be OK if I reached out? 

Originally posted by @Simone Johnson :
FYI: 

I live up the street. This is not a suitable crash pad property. It wouldn’t work well  and word would spread internally and then it would be vacant and you would need to find out another use for the space.

Originally posted by @Josh F.:

If you are interested in a crashpad near the airport in Atlanta, check out this building currently on the market zoned commercial: 3196 Dogwood Drive, Hapeville, GA 30354 ...