In October the SEC finally approved crowdfunding rules. Every real estate professional can now raise up to $1 million annually from non-accredited investors. The average private deal that my company tracks is $12 million. Is it reasonable to assume that a sponsor could put together three to five middle-market deals a year? Then would a $1 million crowdfunding cap make any sense for a $50 million annual deal flow? Would this new rule approval make any difference for the commercial real estate industry? Let’s take a closer look at the data.
The explosive growth of crowdfunding within the real estate sector due to the changes brought by the JOBs Act together with recent significant high-profile investments in real estate crowdfunding platforms has drawn much attention to new online models for accessing and investing in the asset class.
In a historical context, JOBS Act changes represent an extension of the evolution and innovation of real estate capital markets products