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Crowdfunding in Commercial Real Estate

Crowdfunding has gotten a lot of press coverage recently, but does it have any application to commercial real estate? The answer might surprise you. Atlanta Business Chronicle recently wrote about FundRise as an example of a firm that was hoping to bring the power of crowdfunding to the Atlanta real estate scene. But the FundRise model is just one example of how crowdfunding might play a role in getting real estate deals done. First, you need to understand what crowdfunding is (and is not). This blog post will tell you a little about the origins of crowdfunding and how Congress changed federal securities law to make it possible to sell “crowdfunded” securities over the Internet. That effort has become bogged down, however, as the SEC has failed to issue necessary regulations when required by the law. In Part 2 of this blog post I will outline some of the ways that crowdfunding is feasible today and how that kind of crowdfunding might be used to facilitate commercial real estate deals. Crowdfunding – The Background The idea behind crowdfunding is that having a large number of people – with access to information – makes that group (or crowd) more likely to make accurate […]

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