Alternative real Estate Investments

6 Replies

I own several SFR Investment Rentals, and the Market for Rehab properties (Fix & Flip) in my area is very competitive.

Investigating other potential sources offering a good return on funds invested.  Anyone have any experience - pros or cons about investing in CrowdFunding Companies. Couple of examples are FundRise, RealtyShares - I'm sure there are others. 

@Jim Cummings

There are plenty of opportunities where you can act as a lender for companies that are working on projects looking for additional capital.  We are one of them so feel free to let me know if we can possibly work together!

@Jim Cummings ,  I own several single-family house rentals, and also invest in Crowdfunding/syndication deals. As you suggested, the latter are a great way to be able to access more favorable markets in different areas of the country, as well as diversify on geography. (A hurricane here in Tampa, or in Texas by you, can be a problem if all the assets are in one place). The other advantage is that you can get in a much lower price point because you are pooling your money with other investors. The other advantage is that you can also invest in debt, as well as equity to balance out your portfolio more.

The downside is that you give up control to a manager, so you have to feel comfortable with picking them and then turning it over to them. And of course they get paid a fee, so you have to make sure the fee seems reasonable on top of your other due diligence.

I’ve done investigative work and interviewed hundreds of investors to rank over 100 crowdfunding sites, and done in depth reviews of the top 25. If you have any questions on any of them, shoot away.

Appreciate everyone's perspective, I'll research the sites mentioned. 

@Jim Cummings

Hi Jim - The crowdfunding platforms can offer you pros such as the ability to diversify outside your local market and the the advantages of passive real estate investing versus DIY investing. A lot of the crowdfunding platforms solicit single deal investment opportunities for a host of different sponsors, some of which have good return history, some do not - so picking the best sponsor to trust is everything. Another alternative is to invest in a commercial real estate fund that is run by just one sponsor. Origin Investments is an example of one of these fund managers/sponsors. Origin generated a 28% net IRR on its first fund and is on track to provide comparable returns on their 2nd and 3rd funds. Below is a link to a blog that one of Origin's principals wrote on how Origin manages investment risk to achieve out-sized returns.

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