Fundrise, the real estate crowdfunding site, is offering up to $50 million in shares to the public, for the launch of its online real estate investment trust.
This REIT will be used to invest in a diverse portfolio of commercial real estate properties including offices, apartments and shopping centers. The idea is that it will generate cash flow and will be paid out to investors in regular dividends.
“Today is a massively historic day for the Fundrise team the result of over four years of work!” said Ben Miller, cofounder and CEO, in a statement. “Soon anyone in the country will be able to access the same investments as billion dollar institutional funds but with roughly 1/10th of the fees, heightened transparency, and low investment minimums of $1,000.”
Up until recently, only accredited investors, or high-net worth individuals, could buy shares in private companies or trusts. Dubbed a “mini IPO,” Regulation A+ opened up the doors to everyone, regardless of their income or assets.
Fundrise has a history of making it easier for ordinary investors to put money to work. Non-accredited investors can regularly invest in real estate by pooling money together, i.e. “crowdfunding.” Past projects have included World Trade Center 3.
While Fundrise says it was the first to enter the real estate crowdfunding space, there are other startups aiming to do something similar. Patch of Land, Cadre, Realty Mogul and RealCrowd all brand themselves as real estate crowdfunding.
DC-based Fundrise has previously raised over $40 million in capital from Guggenheim Partners, Silverstein Partners, Renren and angel investors.