CrowdVested Launches First Southeast Crowdfunding Campaign for Retail Project in Atlanta
- Apr 24, 2014
A crowdfunding platform for commercial real estate, CrowdVested, along with Atlanta-based developer Paces Properties has launched its first campaign, offering the first equity crowdfunding in the Southeast open to both accredited and non-accredited investors.
Paces Properties is looking to buy, revamp and lease seven mostly vacant retail buildings on Glenwood Avenue in the center of East Atlanta Village. The properties total 26,000 square feet of retail and are partially leased to two long-term tenants. The rest of the property is vacant and has suffered from recent mismanagement.
“We went this route (crowdfunding) because we thought there was unmet demand to invest in commercial real estate by individuals,” Paces Properties Principal Merritt Lancaster told Commercial Property Executive. “Plus, we are focused on intown commercial projects that large institutional investors often don’t understand: who better to invest than the neighbors who will be your customers?”
CrowdVested is acting as a host site for investors to safely invest with Pace Properties. The developer is looking to raise a minimum of $250,000 through this campaign. As part of the Invest Georgia exemption, any Georgia resident can make an equity investment in the project with a minimum fo $500 by logging onto CrowdVested’s website, according to the news release.
“Retail in general is a great candidate for crowdfunding. It’s a great way to reach out to the community and get them vested in the success of businesses in their neighborhood. It is the ultimate affinity program – the better the tenants do, the better the project does, the better the investors do. It is a natural feedback loop, helping to keep money the spent in local stores in the neighborhood,” CrowdVested CEO Grady Thrasher told CPE.
Georgia is one of the few states in which all residents can invest in crowdfunding campaigns and receive equity. While across the nation, crowdfunding is mostly limited to specific websites that specialize in the campaign, equity crowdfunding will eventually be available nationally thanks to the JOBS Act. The Securities and Exchange Commision just needs to approve the necessary rules and regulations.
“Paces is attracted to East Atlanta because we focus on intown projects in established commercial districts,” Lancaster added. “We’re also building 119 apartments around the corner. We love EAV and wish we could buy more. It is a great neighborhood with a great feel that you just can’t replicate.”
Crowdfunding has been a hot-button topic lately in the real estate world, as smaller investors are looking to gain a piece of the real estate investment pie.