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Zack Hughes
Title: General Manager, Blueground Boston
Age: 32
Industry experience: 6 years
After helping build out Uber’s operations in Greater Boston, Zack Hughes is ramping up a new flexible housing model in the multifamily sector. Hughes is the Boston area manager for Blueground, a Greek company that’s promoting a new niche in corporate rentals. Blueground leases blocks of apartments in luxury buildings, furnishes them and rents them out for periods ranging from a month to two years. Blueground manages 60 units in Boston and Cambridge and is targeting expansion to 250 apartments by the end of 2019. The average monthly rent is approximately $4,500 for a six-month stay in a one-bedroom unit. The six-year-old company has raised $20 million from investors including Endeavor Catalyst, Jabbar Internet Group and VentureFriends, and has a global portfolio of 1,500 apartments. Boston is Blueground’s fifth U.S. market, having previously expanded in New York City, Los Angeles and San Francisco.
Q: What category of properties does Blueground look for when scouting out locations?
A: We’re looking for something that’s going to provide an outstanding experience for our type of client: medium- to long-term stays. Everything is a minimum of a month, and that’s hard and fast. We’re getting businesspeople who find us to be a cost-effective alternative to a hotel. Finding a hotel in Boston for $200 a night isn’t possible. This apartment [a one-bedroom unit at 135 Clarendon St. in Back Bay] would not be that much money.
The second group is individuals looking to our solution as an alternative to a traditional rental for the convenience factor alone: people who may be here six months, students from overseas, snowbirds and businesspeople who are looking for a pied-à-terre in the city.
There’s a mix. We have a lot of managed buildings: the Arlington, 100 Pier 4. We’re also taken some nice individually owned walkups: classic Beacon Hill type product that provides a typically authentic Boston experience that some people prefer.
Q: How big is Blueground’s Boston team?
A: We have six people locally and are hiring one or two more. It’s a big advantage for us. We’re at 31 St. James Ave. in the middle of town, and our team can be there in 20 minutes. We’re an upstart and we know that’s a way we can differentiate ourselves.
Q: How does the business model and your relationship with the landlord work?
A: We take vacancy risk off the table for a pretty good period. We’re happy to sign a two-year or three-year lease. We took 10 units at Proto in Cambridge, six at 100 Pier 4 in Boston. We have working relationships with Greystar, Equity Residential, the Lofts at Atlantic Wharf, the Girard and the Troy. We’re looking to get to 250 units by the end of the year. There’s a couple of interesting developments and we’re in conversations to take out some more bulk deals.
Q: What industries supply demand for this category of housing?
A: We have units in Kendall Square and biotech and technology has been big for us. Boston has strong tax incentives for film shoots and we’re putting up a good part of the film crew that’s shooting locally. Some people needed a place for six to eight months.
Consultants are the classic client: the weekday warrior working Monday through Thursday on-site for a client. I personally did that in Minneapolis for IBM before I was at Uber. Our CEO was a consultant at McKinsey for a couple of years and he lived his life in hotels and he didn’t love it. He was looking for something different.
Q: What services can residents access through the Blueground app?
A: It’s a dedicated app that we built ourselves that is a useful tool for information about the property. You can use it to request cleanings and book that, and you can use it to contact us regarding issues and that’s how we make it as seamless as possible.
Q: Which neighborhoods are you targeting for expansion?
A: We’re pretty well distributed around the city. We’re always looking in the North End, South End, Seaport, Kendall Square. We’re not in the Fenway or Harvard Square yet but I would guess by the time of this being printed we may be. We’re expanding quickly in the core neighborhoods of Boston where there’s this luxury project. We want to be near the main places of business.
Hughes’ Five Favorite Boston-Area Music Venues:
- Brighton Music Hall
- Paradise Rock Club
- The Middle East (Downstairs)
- Red Room at Café 939
- The Sinclair
