Socially conscious real estate crowdfunding.
Welcome to the mid-March edition of “The GowerCrowd Real Estate Crowdfunding Newsletter.” It was not a slow news week for the crowdfunding space, as evidenced by the large haul we’ve got for you this week, including a now open for funding risk-adjusted diversified fund from Palladius, a new development opportunity in NYC, 30 Bushwick, brought to you by RealtyMogul. We’ve also got a look at a build-to-rent firm that’s taking on the housing crisis, one project at a time as well as a guide from Forbes Advisor on how to become an accredited investor if you aren’t one already. We will finish our journey with a crowdfunding platform update from PeerStreet that looks at the 1 year anniversary of their socially conscious E.N.U.F program.
New Crowdfunding Platform Deals
We’re going to highlight two deals from RealtyMogul this week.
The Palladius Real Estate I Fund at RealtyMogul is now open to investments. We’ve covered this deal in the newsletter before, but we’ll go ahead and give you a quick refresher in case you don’t remember. It is a private real estate investment fund that is focused on generating attractive, risk-adjusted returns through the usage of thoughtful investments and the acquisition, disposition, and management of equity interests within the student housing and multifamily sectors, in locations all across the United States. It has a target IRR of 17.5%, target cash on cash of 7%, a targeted equity multiple of 1.75x, and a minimum investment of $35,000/ The estimated first distribution for the deal will be in 8/2022, and it has an estimated hold period of 4-6 years. Check it out on RealtyMogul, here.
The second deal brings us to one of New York City’s most culturally relevant and influential neighborhoods. It also happens to be ground zero for hipsters, and likely has the highest concentration in the world today, with all the mustache wax, painstakingly crafted IPAs, and grown men driving to work on unicycles. That neighborhood is New York’s Williamsburg, where The Mortar Group is sponsoring 30 Bushwick, an equity development ground-up 24-unit Class-A multifamily complex in one of the most desirable housing markets in the city, despite the prevalence of all things hipster.
General Crowdfunding Industry News
The dire lack of housing affordability in many if not most major metros in the United States is a serious problem. The reasons for the lack of affordable housing are legion. Some of the contributing factors to this crisis include a decade of historic underbuilding as a result of the 2008 crash, the dramatic rise in the cost of materials and labor, and anti-development and anti-developer policies, particularly in well-heeled areas on the West Coast, like the suburbs of San Francisco and Seattle. An often-overlooked potential solution to this issue is the development and rehabilitation of manufactured housing and mobile home parks, which remain the most affordable option for millions of Americans. Crowdfunding deal sponsor ERC Communities aims to expand this housing supply, and are set to begin development of a single-family manufactured home community in Zephyrhills, Florida, in a state which has seen incredible price growth over the past few years. Read more at Benzinga, here.
With the Biden Administration pondering the enaction of new barriers to crowdfunded investing, now is a good time to brush up on how to become an accredited investor. Also, many crowdfunding deals are currently open only to accredited investors, so even without new legislation or regulations you ideally want to have this status, assuming you’re eligible. Forbes Advisor penned an excellent writeup covering the who, what, where, when, and why behind becoming an accredited investor. Have a gander at Forbes Advisor, here.
Crowdfunding Platform Updates
As is our custom we’re going to leave you with a crowdfund platform update, this week from PeerStreet, which is celebrating a very special one-year anniversary. Last year, PeerStreet started the Evolving Neighborhood Uplift Fund or E.N.U.F. program. Through this program, the company intends to invest in real estate entrepreneurs from underserved backgrounds. These entrepreneurs are also expected to commit to improving their communities as well as work toward closing the wealth gap using the awesome power of real estate. In addition to this being the near 1-year anniversary, the firm also named Robert Palacios as the program’s new director. Read up on this new appointment as well as the program itself at Business Wire, here.
That about wraps it up, but we’ll see you next week with lots more stories, crowdfunding deals, platform updates, and more. See you then.
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