The investment vehicles highlighted have raised modest amounts of capital and enable investors to participate in real estate acquisitions for as little as $1,000 per investor. The level of deal flow varies significantly - a rough survey of the diversity in traction to-date: RealtyMogul and Fundrise both launched within the last few months, have raised $500k and nearly $600k, respectively, and each have two live deals. Collaperty is raising over $22mm in equity and has 14 active deals. Some are hyper-local, like FundRise, which allows individuals to invest and then get involved in their own communities. Others enable access beyond the US: Prodigy Network covers Class A investment properties domestically and in Latin America. Nearly all property types are represented in one form or anther - from single family residential to commercial office, hospitality and multifamily. Beyond traditional real estate categories: Fquare allows for investments in pre-vetted, operating farmland.
Collectively - these funds represent fascinating innovations and signal growing consumer appetite for both participation in local property markets, as well as more modern, efficient, user-friendly (note the informal language, near-omnipresence of words like 'collaboration' and 'community', and beautiful user interface to underscore friendly), and transparent ways to access and manage investments.
Beyond the fun of selecting each deal and the convenience of transacting on-line, these vehicles may enable investors to access an oft-overlooked sweet spot in asset size: above that accessible to the individual or club investor, but below the reach of high-overhead institutional investors. Investing through highly-specific platforms like the ones highlighted in Drake's article may also allow individuals with non-real estate day jobs to avoid the massive headaches and risk concentration it takes to purchase assets as an individual or club, as well as the inherent inefficiencies of large-scale, institutional investments which do a great job with scale but are often hampered by multiple layers of fees and tendencies to invest-with-the-pack.
That said, new structures raise a number of questions re: reporting, regulation, investor protection, and of course - performance. Buyers beware - and time will tell. Welcome your thoughts and ideas as always.