If you’re thinking about diving into the world of real estate investing, you’ve likely stumbled upon CrowdStreet. This platform is becoming increasingly popular among investors, but is it right for you? Here’s our Crowdstreet review to help you decide.
What is CrowdStreet?
CrowdStreet is a prominent platform in the online commercial real estate marketplace. It is specifically designed for accredited investors, granting them the opportunity to diversify their portfolios by incorporating commercial real estate projects. These investors can directly invest with sponsors, acquiring an equity portion in the chosen project. CrowdStreet takes pride in its robust vetting process, ensuring that only high-quality deals sourced from reputable real estate teams are presented on their marketplace. However, is CrowdStreet a scam?
The platform has proven its credibility and success in the industry. As of mid-2023, thousands of investors have committed over $4.16 billion across more than 777 investment opportunities. This vast number is a testament to its recognition as a leader in the online commercial real estate sector.
Aside from facilitating investments, CrowdStreet also offers a wealth of knowledge through instructional videos and articles on essential investing topics. These resources guide investors on topics like reviewing investment offerings and understanding crucial metrics. Such educational tools enable investors to make more informed decisions.
Features of CrowdStreet
- Vetting Process: The platform boasts a rigorous vetting process. A mere five percent of all deals reviewed make it onto the platform, ensuring that investors are presented with high-quality opportunities.
- Direct Investment: Direct investment into real estate projects is a key feature of CrowdStreet, giving investors the chance to financially engage with commercial real estate projects directly. This direct involvement means investors can reap benefits in various forms, whether through regular quarterly dividends, consistent monthly cash flows, or a one-time payout when the project concludes.
- Investment Structure: There are primarily three ways to invest on CrowdStreet: Individual deals, diversified funds, and managed portfolios .
- Investment Minimum: Most CrowdStreet deals set an investment floor at $25,000.
- Fees: CrowdStreet does not impose any fees on the investor to set up an account.
- Liquidity: Investments made into a project via CrowdStreet are illiquid. This means that withdrawing one’s investment isn’t straightforward. Funds get utilized for various project-related expenses, and each deal specifies its targeted investment period.
Who Can Use CrowdStreet?
Are you wondering why real estate could be right for you? Well, if you’re an accredited investor, CrowdStreet might be the platform to explore. Now, what exactly does “accredited investor” mean? An accredited investor refers to an individual or a couple who meets certain financial requirements. These are set to ensure that the investor has the financial stability to absorb potential losses from such investments. The criteria are having a net worth exceeding $1 million, or having an income of at least $200,000 each year for the last two years (or $300,000 combined income if married).
While you can technically open an account with CrowdStreet for free, the majority of the investment opportunities available on the platform require a minimum commitment. As noted, prospective investors should be ready to invest a starting amount of at least $25,000, and some offerings may necessitate up to $250,000. Additionally, those wishing to benefit from CrowdStreet’s managed portfolios should maintain a minimum account balance of $250,000, with tailored portfolios incurring annual management fees ranging between 2% to 2.5% annually.
Not only that, CrowdStreet provides an online marketplace where both active and passive investors can explore real estate investment opportunities. Catering to real estate sponsors, CrowdStreet presents them with avenues to raise capital and list their real estate deals for potential investors.
CrowdStreet vs. Other Investment Options
Comparing CrowdStreet to competitors like Fundrise, let’s delve into a quick Fundrise review to highlight the differences.
Comparing Fundrise vs. CrowdStreet, both platforms offer commercial real estate investment choices. However, CrowdStreet distinguishes itself by catering to accredited investors and providing access to a wider variety of commercial real estate projects, including office, industrial, retail, and multifamily properties.
Fundrise, on the other hand, tends to focus more on crowd-funded real estate for non-accredited investors, offering eREITs and a simplified approach to real estate investing. CrowdStreet’s emphasis on direct access to individual projects and its appeal to accredited investors set it apart in the realm of real estate investment platforms.
Crowdstreet Review: Final Thoughts
CrowdStreet is becoming a go-to platform for many accredited investors looking to diversify their portfolios with commercial real estate. With a range of investment options and a trustworthy reputation, it’s easy to see why.
Whether CrowdStreet is the right platform for you depends on your financial situation and investment goals. Hopefully, more Crowdstreet reviews provide you with the information you need to make that decision. It’s essential to remember that investment always comes with risks. Ensure you’re informed and ready to take those on before diving in.
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Disclaimer: This article contains sponsored marketing content. It is intended for promotional purposes and should not be considered as an endorsement or recommendation by our website. Readers are encouraged to conduct their own research and exercise their own judgment before making any decisions based on the information provided in this article.
