CRE Crowdfunding From Crypto-currencies to Farmland
New Crowdfunding Platform Deals
The Ashton Farm sits in Lee County, Illinois, roughly 2 miles northeast from the town of Ashton, Illinois, and about 75 miles west of Chicago. This 220-acre corn and soybean farm has a flex lease agreement which may provide investors with an additional upside. The farm’s operator has a longstanding relationship with AcreTrader, as well as a proven record of success. The capital raised in the offering will be used to fund drainage improvements on the farm. AcreTrader hosted a webinar for the farm on Tuesday, 10/19, you can catch the recording here.
The other offering is the Arlington Farm, also located in Illinois. This 149-acre corn and soybean farm is located in Bureau County, Illinois, one of the most fertile farming regions in the state of Illinois and the nation as a whole. The farm is made up of 136 tillable acres composed of deep Osco and Sawmill soils, which are among the most productive soil types in the state of Illinois. The main crops for the farm, corn and soybeans, are planted in a rotation in order to defend the soil’s productive capability. You can request more information about the Arlington Farm directly from AcreTrader, here.
General Crowdfunding Industry News
Whether you think cryptocurrencies are the next big thing, or that they’re a repeat of tulip-mania in the digital age, it’s clear that many real estate firms are racing to adopt the underlying tech behind most cryptocurrencies- distributed ledger or “blockchain” technology. That’s fine, you may say, but what does this have to do with real estate crowdfunding? Three words: real estate tokenization.
If you’re familiar with how most crowdfunded deals work you’re aware that there is significant infrastructure dedicated to carrying out the day to day business of a deal- when metrics are met or time horizons expire sponsors are required to carry out whatever duties are necessary, usually getting investors paid via distributions.
Going forward this process is likely ripe for massive disruption, as covered in an article from Cointelegraph last week entitled “Blockchain brings the sharing economy to real estate investing.” They look at how crypto adoption in the real estate market could result in tremendous growth for the real estate crowdfunding space and fractional property as a whole. Check it out here.
Crowdfunding Platform Updates
On a related note, real estate crowdfunding platform Republic recently launched a $60 million crypto seed fund. If you’ll recall, Republic is a generalized crowd-equity platform that offers investments in real estate assets, as well as in startups, gaming, and now, cryptocurrencies. The firm is divided into three arms- venture-focused Republic Capital, Republic Crypto, and their retail business, Republic.co.
In addition to their new seed fund, Republic is also exploring the issuance of their “Note Security Token” which is secured on the Algorand blockchain and used to provide profit-sharing interests in certain Republic portfolio holdings- a move that may have a profound impact on the real estate crowdfunding space in the near future. Learn more, at Coindesk, here.
Finally, we’ll take a look at a recent blog post from Fundrise in which they describe the method to their madness and why they choose to invest in “smile states” to potentially help their investors earn better returns on their capital. These “smile states” consist of two metro types- major urban areas that sit along the coasts, also known as gateway metros, and growth metros that arc across the American Sunbelt.
According to Fundrise, these market clusters offer up several advantages that work to benefit real estate investors, including large, educated populations, effective public transit networks, cultural amenities, and land constraints, and other barriers to entry. Read more about how Fundrise uses its “smile state” methodology to get better returns for investors, here.
That wraps it up for this week, but no worries, we’ll see you next week with all the deals, stories, updates, and goings-on in the real estate crowdfunding space. We’ll see you then.