With Dubai a major destination for businessmen, who often have to stay in hotels for extended periods, Alexander Chatzieleftheriou spotted an opportunity.
His four-year-old startup leases apartments from owners at market value, furnishes the place and rents it out to companies for their employees at a 30% to 60% markup—which still comes out cheaper than a month-long hotel stay. The service is available in Athens, Istanbul and became available in Dubai last August.
The emirate also has a large expat community, and when multinationals relocate their employees, they typically provide them with temporary housing. With this in mind, blueground leases apartments in business hubs—downtown Dubai, Dubai International Financial Center and the Marina area. It has leased 65 properties, with plans to lease 250 by the end of the year.
Customers include IKEA, Panasonic and Parsons, which book apartments for one month or longer. “As long as we continue being careful about the property we select, promoting them well, pricing them well, I don’t see this as a risk,” he says. With more than 400 properties in Athens, Istanbul and Dubai, Chatzieleftheriou says the company’s occupancy rate at 94%.
Last week, he raised $5.8 million in series A funding, led by VentureFriends, an Athens-based early stage venture firm, and Endeavor Catalyst, a New York firm which invests in startups worldwide.
The home-sharing industry is highly regulated in Dubai. Airbnb became legal in April 2016, when the government allowed tenants to rent out their homes short-term to visitors.