Is The Future Of RE Fundraising Really Online?
The real estate publication Globest has been following the progress of the first of its kind, real estate based crowdfunding firm called Fundrise. Previous successes for the firm include helping Larson Realty Group generate $38 Million for the redevelopment of Tiger Stadium in Detroit (which was covered by Crain’s Detroit Business), as well as helping the World Trade Center owner-developer Silverstein Properties and the Collaborative Fund raise over $31 Million for their own development projects. At the time of the Silverstein fundraiser back in May of 2014, it was estimated by MarketWatch.com that Fundrise was raising an average of $1 Million a week on its platform, a number that has only increased over the last 10 months.
Founded in 2010 by brothers Ben and Daniel Miller, Fundrise has brought real estate crowdfunding to the mainstream, raising more capital in its Series A than any other equity crowdfunding company has raised in a first round worldwide. The company states on its website that its main goal is to provide “access to investment opportunities from the best real estate companies in the country, all through one simple, transparent platform”.
Today, Globest has posted an article describing how the firm is “writing a new playbook for capital sourcing in redevelopment markets ripe for deal financing, but too small for large investors to back”. The article goes on to credit the increased awareness of the online market in real estate, as well as the JOBS Act which was created in 2012, with opening the door for such technology to have the impact it is currently having on the market. Globest writer Steve Lubetkin goes on to say, “The JOBS Act relaxed securities regulations that previously restricted general solicitation of private placement investments, and equity crowdfunding, or the offering of equity- or debt-based securities to the crowd. In 2013, $2.2 billion in capital was raised via equity crowdfunding”.
To learn more about Fundrise, please visit their website. To learn more about the company’s involvement with fundraising for the redevelopment of Tiger Stadium please see the article on Fundrise’s website, which is available here.