1539 7th Street NW
Fundrise, the DC-based online platform that allows residents to invest in local real estate and businesses, had one of its most successful mornings yet on Wednesday, garnering more than $100,000 from more than 100 investors in just two hours, its cofounder Ben Miller told UrbanTurf.
The offering, which invited everyday investors to get a piece of a commercial property in Shaw that Fundrise hopes to turn into a restaurant, followed the company’s unusual model of allowing the public, and every investor, to see whom they’re investing with. The property is located at 1539 7th St NW (map).
As of 9:30 a.m. on Thursday, 165 investors had raised $138,000. Shares start at $100, and the project’s goal is $350,000. Once that amount is reached, Fundrise will begin the leasing process, which it estimates will take 6-9 months. The project is only open to investors from DC, Maryland and Virginia.
“It’s flying,” Miller told UrbanTurf. “Every time we do it, we get more money, faster, from more people. People are interested, they’re wondering. They want to see where it goes.”
Fundrise lays out how investors can make money through their investment:
Investors are projected to receive an 8% preferred return, paid quarterly, in Year 1 – 5. For example, if someone invested $100, they would receive $8 each year, paid out in $2 each quarter. The investment principal is projected to be returned to investors at the end of Year 5. If the sponsor elects not to return the principal, the preferred return for Year 6 will increase to 12%. If the sponsor elects not to return the principal at the end of Year 6, the preferred return will increase to 14% for Year 7, and 16% for Year 8 and each year going forward thereafter.
Fundrise has taken on residential projects too, including a 100-unit project at 3400 Georgia Avenue (map). That project also offered $100 shares, but unlike this project, set a minimum ceiling of $10,000 for investors, limiting it to more established parties.
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This article originally published at https://dc.urbanturf.com/articles/blog/latest_fundrise_offering_nets_more_than_100k_in_two_hours/8285.
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