Aug 26, 2018
I am relatively new to CrowdStreet, but they have great deal flow and offer very attractive returns. Most deals are equity deals rather than debt deals. Their due diligence appears to be thorough. Most deals have minimum of $25k or higher, but a few are as low as $10k. One minor frustration I have had is trying to determine how the investment income is taxed. Most deals provided K1 forms annually which will provide income, depreciation, and capital gains info. However, very few of the sponsors are able/willing to provide projections for these numbers. Most deals seem to have significant depreciation so for many deals it seems you won't get hit with taxes until deal is fully closed and most of the income will be taxed favorably as capital gains.
The other slight nuissance is the paperwork and funding for deals. My prior experience is with ShareStates which is very easy to invest and fund deals after you are registered and verified as accredited investor. With ShareStates, you basically just click a few boxes to approve ACH transfer from your bank account (which you can save in your investor profile). With CrowdStreet, ACH transfer is often not an option so you have to send funds either by wire or mail. Also, you have to send funds directly to each sponsor so each investment requires different addressee information instead of one central place that distributes funds to sponsor. The paperwork for investor agreeemnt is also more onerous than I am used to with ShareStates.
But overall I am moving towards this platform because of deal flow, attractive returns, and favorable tax treatment of equity deals despite my minor frustrations..