Five Realty Crowdfunding Projects

Raising $50M Or More

by David Drake
Real estate crowdfunding has been growing exponentially for the past couple years, and this year
the industry continues to move from being a niche phenomenon to establishing itself as a
legitimate and credible fundraising tool. It has also transformed real estate investing from being a
rich mans preserve to an activity in which the ordinary retail investor could participate. It provides
smaller investors the opportunity to directly invest in real estate projects located in their own
communities. TimesRealtyNews.com that I write for, as of September 1, 2014, saw $2 billion in
real estate crowdfunding affected.

Here we take a look at the top five real estate crowdfunding projects that became doable raising
north of $5-$200 million. These are to date some of the largest crowdfunding exercises in the real
estate industry, raising the largest sums of money from the crowd:

BD Bacat
This planned skyscraper in Bogot, the first in Colombia in 30 years, will be the tallest building in
the country when it opens in 2015. It is 66 stories tall and will offer more than one million sq. ft.
including a hotel. The structure was not financed conventionally, but in the largest crowdfunding
exercise to date, more than 3,800 Colombian investors contributed more than $170 million in
cash. The deal was put together by Prodigy Network.

17 John Street
Prodigy Network closed this deal on September 3, 2014 in downtown New York for a price of $85.3
million of which $25 million was raised through crowdfunding. Accredited investors from 12 states
in the US and 10 countries were involved with contributions as low as $50,000. However, this may
just be the beginning as the company plans to raise an additional $41 million from crowdfunding to
pay for the transformation of the hotel into an extended stay hotel with 191 units over 23 stories.
The company says that this is yet another example of providing access to smaller accredited
investors to big real estate projects.

84 William Street
The building in lower Manhattan has been acquired by a joint-venture consisting of Korman
Communities, Shorewood Real Estate Group LLC, and Prodigy Network and is being renamed AKA
Wall Street. A project costing $40 million spread over 15 months will result in a fully furnished
building providing extended stay facilities for people visiting New York. The community will consist
of 140 suites of different sizes and include amenities such as a cafe and a fitness centre. Of the
total project cost of $ 110 million, $ 25 million was crowdfunded from foreign investors belonging
to 6 different countries.

Weissenhaus Grand Village Resort & Spa

This planned five star resort located on the Baltic coast near Hamburg has set a new record for
Europe in real estate crowdfunding. Through the crowdfunding platform Companisto, it has raised
4.2 million from more than 800 investors to raise funding for an expansion project. The terms for
the crowdfunding include an interest rate of 4% per annum, the share of the rise in property
values as well as revenues. The owner Jan Henric Buettner has already invested approximately
65 billion and the resort opened in July 2014. This fundraising is also significant because of the
relative lack of venture capital in Germany.

Fulton Street
This project involved building a $250 million condo tower on six parcels of land at 90-94 Fulton
Street. iFunding raised around $8 million through crowdfunding and plans to raise a further $ 42
million in equity. The building project, which will be around 75 stories tall and provide 250,000 sq.
ft. of space, is also believed to have obtained a commitment from a large bank for a construction
loan in the range of $150 million $200 million. The developer is Erin Wickombs Mavrix Group.

Note: This article appeared on The SohoLoft with this link http://thesoholoft.com/five-realtycrowdfunding-projects-raising-50m-or-more-by-david-drake/
on November 06, 2014.

Photo credit to knowledge.wharton.upenn.edu

David Drake is the Chairman of LDJ Capital, private equity advisory; Victoria Partners, a 110 family
office network; Drake Hospitality Group; and The Soho Loft Media Group with divisionsVictoria
Global Communications, Times Impact Publications, and The Soho Loft Conferences. Reach him
directly at David@LDJCapital.com.