Platform Provided Due Diligence:
Quality of Deals:
Website - Realty Shares
Fees - 1% annual management
Phone - 866-202-2023
SEC REG - USES 506(b) Open Investments can NOT be advertised or publicly discussed
RealtyShares is a crowdfunding platform dedicated to real estate investing and development. Their approach creates an ideal way for developers to get funding fast, as well as allow investors with as little as $1,000 begin to invest in real estate. Investors can place funds in commercial, retail, residential as well as multiple-use property.
Launched in late 2013, RealtyShares participated in the 500 Startups Accelerator, and has funded real estate crowdfunding projects in eight states in the United States. The total value of real estate holdings funded through the site is north of $70 million.
Currently, only accredited investors can invest in offerings. The site is waiting on SEC rulings that would allow them to open up to non-accredited investors. In April of 2014, the company raised $1.9 million dollars from General Catalyst Partners. They have also secured funds from former E*Trade Chief Operating Officer Neil Sequeira and Savneet Singh, currently head of Gold Bullion International.
Investors can join the real estate crowdfunding site for free. When they invest in an offering, the site charges a fee to fund reporting and ongoing communications with the client. Investors should consult the operating agreement on each investment to review the fees involved.
RealtyShare offerings are all private placements exempt from rule 506(b) of Regulation D. Currently RealtyShares is not using the new exemption called Rule 506(c) which would allow them to advertise their service to the public. They plan to advertise in the future, however.
In what follows, are the top RealtyShares reviews.
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Feb 19, 2017
RealtyShares was my main platform starting out. I have made 8 investments with them: 2 have completed successfully, 2 have completed unsuccessfully, 1 is in progress doing well, and 3 are in progress doing badly. It may just be bad luck or bad judgement on my part. 3 of the problems are with one sponsor, TriWest.
They don't prefund and don't seem to put your $ to work quickly. Even when a simple debt deals goes as planned, the IRR is a fraction less than advertised, I think it's because they take your money early and don't put it right to work.
I will not use RS anymore..
Jan 31, 2017
As my first RE crowdfunding platform, I have 8 deals with them. Payments are consistent and roughly on time (no more than one week late). Impressive with the time to close in the past, but lately has not been as good. Moved most equity deals to CrowdStreet..
Jan 30, 2017
One of my favorite platforms in 2014. I believe in the rush for deal flow their underwriting has slipped over the years. One of their co-founders left and that is when the quality started to go south. I had some very successful investments, but I had my share of problem deals here too. The 506 investment group has convinced me that the key to a successful investment is a quality sponsor with a strong track record and experience. There are a lot of sponsors on this platform that do not fit that criteria. I would invest again here, but It has to be a special deal with a special sponsor after considerable due diligence. Paying a 1% annual fee is another disadvantage they have over the 506c platforms with higher quality sponsors..
Jan 30, 2017
I have done one deal with RS, but looked at a lot (only on equity side, not the debt side). My biggest issue with them is the way they handle investor communications. I don't think it is a priority for them. I don't think their deals are any better or worse than the deals on other platforms, but given they charge 1% extra fee it is a drag on returns..
Jan 30, 2017
I had 1 round trip deal and 1 in-progress with RS. All payments are on-time with no issues. Both were debt deals.
My only RS complaint is payment #1 takes longer than other platforms: 1 full month must elapse. For example, an investor's 1st payment is received towards the end of March if the investment begins anytime in January. It seems like RS could at least pull this up to February at no cost..