RealtyMogul.com Transforms CRE Capital Markets
- Jun 16, 2015
RealtyMogul.com expands again. The online real estate crowdfunding marketplace is introducing two new products, courtesy of $250 million in direct commitments from a group of large institutional investors.
The identities of the contributors are not being disclosed, but they all have something in common: substantial balance sheets. RealtyMogul.com is only two years old, yet it was able to reel in a quarter-billion in commitments. The investors had their reasons.
“They were attracted to RealtyMogul.com for two primary reasons, one being the strong credit quality of our originations,” Jilliene Helman, CEO & co-founder of RealtyMogul.com, told Commercial Property Executive. “We take credit and risk management very seriously and our chief credit officer, Megan Goodfellow, was formerly a credit officer at JP Morgan.”
Helman also cites RealtyMogul.com’s deal flow as a magnet. “Many institutional investors are sitting on idle cash and need to put that money to work,” she continued. “Through our online platform, we generate thousands of high-quality leads each month and can give institutions access to deal flow they were historically blind to.”
The new investor commitments pave the way for RealtyMogul.com to provide borrowers with two new offerings: a three- to five-year, floating bridge product in the four to six percent range, and a fixed-rate program that is priced in the four percent range and primarily adheres to the standards set by the commercial mortgage-backed security securitization market. Here, RealtyMogul.com is breaking new ground, as the new product marks the first time a competitively priced CMBS loan is being made available through an online marketplace, the company’s leadership asserts. It’s a product whose time has come.
“Online capital markets are becoming more and more accepted in the marketplace,” Helman concluded. “LendingClub drove a lot of adoption towards online capital markets with their IPO in December of 2014 and more and more real estate professionals are comfortable using the internet to access capital. It’s a natural evolution for the markets.”
Spring has been a fertile season for RealtyMogul.com. In April, the company launched a new commercial lending division, building on its previous accomplishments in the commercial equity and residential lending arenas.