A $20 million funding round has allowed apartment leasing firm Blueground to expand its offerings in Chicago and other cities.
Blueground leases apartments in some of the city’s most prominent rental buildings, and then subleases them to business travelers and others looking for flexible living arrangements. The leasing is done through Blueground’s website, and renters use an app as an interface once a unit is leased.
The firm launched in Chicago in the fall, with four units in the Loop and surrounding areas. But thanks to a funding round that secured $20 million earlier this year, Blueground plans an aggressive expansion in Chicago, said Matthew Lohmann, general manager for Blueground in Chicago.
The goal for the firm is to control 250 apartments in Chicago by the end of the year, Lohmann said. Blueground will control 80 apartment units by the end of the month.
“We’ve doubled down in those [Downtown] neighborhoods, but there are some areas outside the core we’re also looking at,” he said.
Founded in 2013 in Athens, Greece, Blueground seeks to provide other options for extended-stay travelers other than hotels. The company leases units in urban, highly amenitized buildings, and furnishes them to give its clients more of a homey feel when away, Lohmann said.
Blueground’s clientele is not exclusively business travelers, Lohmann said. It is also new residents who want to get a feel for an area before committing to a lease. One of its local clients is a new grandmother who moved into a unit to be closer to her newborn grandchildren, he said.
“They want something that’s more like home, that has the amenities they’re used to and is in the location they want to live,” Lohmann said.
Stays must be a minimum of one month, but the average stay is about six months, the company has said.
In Chicago, Blueground leases apartments in One Bennett Park, 465 North Park Drive and the recently delivered Essex on the Park. The firm is now looking to expand into more far-flung neighborhoods and to lease in different building types, including properties as small as three-flats, Lohmann said.
As rentals and co-living arrangements continue to gain popularity, Blueground has found a niche in the flexible living market. Its revenue has increased by 250 percent in less than four years. That success led to the most recent funding round, which drew investments from firms including Endeavor Catalyst and VentureFriends. To date, Blueground has raised $28 million, according to the company.
“We see the patterns of renting an apartment changing,” Alex Chatzieleftheriou, Blueground’s founder and CEO, previously told The Real Deal. “The whole idea for Blueground is we want people to move seamlessly from apartment to apartment.”
Rents for Blueground’s Chicago units range from $2,590 to $5,390, according to its website. The company is in nine markets worldwide with 1,800 rental units under its control.