The following post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga.
With investment minimums often set at $500k or $1MM, owning commercial real estate is out of reach for many people, but investors have options to add the asset class to their portfolios with much lower minimums.
Real estate investment trusts (REITs) like Boston Properties BXP and Simon Property Group SPG are one way investors can own real estate while avoiding large down payments and the extensive due diligence required to make sure their investments are sound.
REITs buy commercial real estate and disperse the rental income to investors. The drawbacks to investing in REITs are that investors have no control over the properties being purchased and prices fluctuate like stocks.
Another vehicle that can be used to invest in real estate is crowdfunding, which gives investors more decision-making power than REITs do and lets them choose specific properties they want to own directly. With real estate crowdfunding, investors also have the potential to earn a substantially higher return on their investments.
Standing Out From the Crowd
One company that can help you get started in real estate investing is RealCrowd, a Portland, Oregon-based online marketplace that connects investors with properties and funds across the country.
RealCrowd is not a REIT. RealCrowd provides access to passive real estate investment opportunities offered by professional real estate managers. Investors have access to the manager who is listing the deal if they have questions. The company does not charge investors any fees to use the platform.
“It’s a pretty simple model, investors invest online into the properties of their choosing,” said Tyler Stewart, RealCrowd’s vice president of investor relations. “While the real estate managers manage the property, tenants, and report back to investors.”
Real estate that’s available to choose from on the RealCrowd platform ranges from multifamily and office properties to self-storage and educational facilities. A property’s real estate manager sets the minimum that can be invested in a property, which typically ranges from $25,000 to $100,000.
The RealCrowd website also provides educational materials and coursework to help investors understand the fundamentals of real estate investing so they can reach their goals. Its podcasts feature industry experts who provide insight into the world of real estate investing.
“In our industry, high investment minimums and limited access to education have always been a major blocker for individual investors,” Stewart said. “Now with the efficiency of technology, minimum investment amounts have dropped, access has increased, and we’re seeing real excitement from investors to soak up as much knowledge as they can on commercial real estate investing.
The preceding post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga. Although the piece is not and should not be construed as editorial content, the sponsored content team works to ensure that any and all information contained within is true and accurate to the best of their knowledge and research. This content is for informational purposes only and not intended to be investing advice.
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