Real estate crowdfunding for the retail investor? The new, non-trading REIT (real estate investment trust) launched by RealtyMogul.com is designed to provide just that. Called MogulREIT I, the REIT takes advantage of Regulation A+ in Title IV of the JOBS Act and will be used by RealtyMogul.com to raise up to $50 million. Most interestingly, unlike the crowdfunding platform itself, nonaccredited investors will be able to invest in MogulREIT I.
“We’ve made it our mission to introduce a fair and simple way to invest in real estate,” CEO and founder Jilliene Helman said in a video explaining MogulREIT I. “The launch of our REIT is another step towards making real estate investing accessible for more and more people across the country.”
MogulREIT I is built to provide investors with consistent cash distributions as well as capital preservation and appreciation. The REIT charges no sales commission, and only a 3% organization and offering expenses fee (typically, for non-traded REITs, these sums are 7% sales commission and as much as 15% in organization and offering expenses.) The savings come courtesy of RealtyMogul.com’s decision to directly offer the REIT via its own website “eliminat(ing) the traditional, manpower-intensive distribution channels and the high expense load that comes with them.”
The REIT invests in apartment buildings, industrial parks, office complexes, retail centers, and self storage facilities. No “ground-up construction or land development” properties will be invested in by the REIT, which pledges to rely on established and experienced real estate companies and professionals, as well as communities “with strong economic fundamentals.” Funds can be withdrawn on a quarterly basis and the minimum investment is $2,500. Read the offering circular for more information.
Founded in 2012 and headquartered in Los Angeles, California, RealtyMogul.com demonstrated its crowdfunding tool for real estate at FinovateSpring 2014. More than 80,000 individual investors have joined RealtyMogul.com since its inception, with more than $200 million in debt and equity invested through its platform. Investors have received more than $40 million in payouts.