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What do you guys think of Fundrise as an alternative to REITs?

https://www.fundrise.com/investments

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Looks a lot less diversified than the typical REIT, for one. They only list 5 properties you can invest in, and they're all in Washington, DC.

Now, that would be ideal if you happened to want concentrated exposure to those properties only.

People really like Toki Underground(its an upscale ramen noodle place.) So that one probably has promise. As does the property on Florida Avenue, and potentially the gentrified Shaw property. H Street is up and coming down by Rock and Roll Hotel but that Autozone is not in the part that is. I feel uncomfortable walking down there at night still.

They're all funded anyway though so its pretty moot as it currently stands.

A million dollar investment with 500 investors and a developer that probably has no equity in the deal and no clue what he is doing otherwise he would be able to get a bank loan. Sounds great, don't sign me up. LOL

But wait it is crowd funding, that is all the rage right, what can go wrong?

acroBios said:   A million dollar investment with 500 investors and a developer that probably has no equity in the deal and no clue what he is doing otherwise he would be able to get a bank loan. Sounds great, don't sign me up. LOL

But wait it is crowd funding, that is all the rage right, what can go wrong?

  
yeah that's what I thought too.. kickstartr for REITs

vickh said:   
acroBios said:   A million dollar investment with 500 investors and a developer that probably has no equity in the deal and no clue what he is doing otherwise he would be able to get a bank loan. Sounds great, don't sign me up. LOL

But wait it is crowd funding, that is all the rage right, what can go wrong?

  
yeah that's what I thought too.. kickstartr for REITs

  Except no publicly traded REIT would actually use this. This is kickstatr for developers that will probably fee your return to death. 

I think the best way to make money off this would be to be the developer that soaks up all the crowd-funding

You might want to investigate the development and the developer before investing.  With real estate, it's important to do your homeworkk.  For example, I recently looked at the IPO for a homebiuilder in California.  I work in a related industry and I thought it might be a good investment because I am familiar with the locations in which they acquired properties (at the bottom of the market) during the last few years. .  I decided not to buy stock in their company because the mark-up (price differential between their acquisition price and the price they were contributing the properties to their public offering) was enormous.

TravelerMSY said:   Looks a lot less diversified than the typical REIT, for one. They only list 5 properties you can invest in, and they're all in Washington, DC.
  
I'm waiting for them to add some buisnesses from Detroit

You need to be an accredited investor to participate.  No such requirement for REITs.

acroBios said:   A million dollar investment with 500 investors and a developer that probably has no equity in the deal and no clue what he is doing otherwise he would be able to get a bank loan. Sounds great, don't sign me up. LOL

But wait it is crowd funding, that is all the rage right, what can go wrong?

  
They're actually the sons of one of the biggest developers in DC, so they certainly have access to money.  This is more like a pet project; they have other deals going on as well.  I looked into this but decided against it for liquidity purposes.

Here's a NYT article that discusses them:  http://www.nytimes.com/2013/05/15/realestate/commercial/washington-projects-invite-the-small-local-investor.html?pagewanted=all&_r=0  

I saw an article recently about how a surprisingly low percentage of hardware based projects on Kickstarter are actually fulfilled. Turns out it's actually much easier to come up with an idea than it is to fully flesh out a design and build the thing, which is certainly a reality that applies to real estate development, too.

Point being, with Kickstarter those who contribute have no recourse if a project faces extensive delays or is never completed. That sucks if you contributed $100 for a vaporware game system. If crowdsourcing RE works the same way, it would really suck if you've invested not tens or hundreds but thousands of dollars.



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