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KBSDirect.com launches $1b no-load real estate fund on CrowdStreet Marketplace
Other - FEBRUARY 22, 2018

KBSDirect.com launches $1b no-load real estate fund on CrowdStreet Marketplace

by Released

KBS has launched a new $1 billion no-load and no upfront commission growth and income properties fund on the CrowdStreet Marketplace.

KBS is offering its new fund, the KBS Growth & Income Fund, through both the CrowdStreet Marketplace and its own direct-to-investor platform at KBSDirect.com, which is powered by CrowdStreet technology. KBS is taking this unique omnichannel marketing approach to provide access and engage a wider array of accredited investors seeking institutional-quality investment opportunities managed by leading professionals.

“Commercial real estate investing is going through a dramatic transformation,” said Peter Bren, chairman of KBS Realty Advisors and KBS Capital Advisors. “For individual investors and the trusted advisers who serve them, real estate investing is moving from a fee-laden, high-load broker/dealer environment to one where online platforms support institutional-quality investments and aligned interests among the investor, the adviser and the fund, with lower fees, commissions and administrative costs.”

The KBS Growth & Income Fund was launched in beta last October through KBSDirect.com, and is the first offering in KBS’ 26-year history in which investors are able to directly buy shares online. KBSDirect.com increased the size of the fund to $1 billion and is now offering it on the CrowdStreet Marketplace, opening the opportunity to an even larger pool of investors who may have been interested in investing in institutional commercial real estate, but sought a smaller minimum investment amount and a desire to spread their investments across a growing portfolio of professionally managed assets.

“This trend of direct investing through online platforms is delivering strong returns with greater transparency to investors nationwide,” said Tore Steen, CrowdStreet CEO. “Our platform is on the leading edge of this trend. We enable top-tier commercial real estate firms, like KBS, to effectively take institutional investing online, both through their own branded channel, as well as using the additional channel of our Marketplace, which is experiencing 3x annual growth.”

With KBSDirect.com’s no-load approach, the company will not receive any of its incentive compensation until its investors have received a 100 percent return of their gross investment amount, plus 6 percent on their investment, ensuring that all of the investors’ capital will be invested directly in the Fund. The targeted average annual investment return is 10 percent to 14 percent at the property level, and the investment period is five to seven years, with a low minimum investor amount of $10,000. The Fund intends to generate both growth and income, and includes a monthly distribution paid to investors equal to a 5.5 percent annual rate of return on their investment. KBS, the parent company to KBSDirect.com, has a strong history of managing institutional-quality commercial real estate assets. Since its inception in 1994, the company has managed $36 billion of income-producing real estate.

“Launching the KBS Growth & Income Fund on the CrowdStreet Marketplace is an important part of our omnichannel marketing strategy to reach registered investment advisers, accredited investors and their financial advisers,” said Lew Feldman, president of KBSDirect.com. “It enables us to take advantage of new, proven distribution opportunities, while serving the real estate investment needs of the modern investor. CrowdStreet’s technology platform has enabled us to effectively incorporate an online function to communicate the legacy brand of KBS through content and education, to onboard and communicate with investors and registered investment advisers in a pleasant and secure user experience, to reach new distribution channels for no-load and no commission KBS real estate investments, and to drive operational savings and economies of scale that will inure to the benefit of the investor and the adviser.”

The CrowdStreet platform has raised more than $260 million of equity to date, with nearly 200 total projects funded. In 2018, the company expects to fund an additional $300 million in equity on the Marketplace.

 

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