Realty Shares
Type:
Real Estate
Focus:
Real Estate Debt & Equity

Overall:

Platform Provided Due Diligence:

Platform Fees:

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. 

Due Diligence & Discussions

Share your experience. Rate and comment!

Robert Fakheri

Aug 26, 2018

I only recently started using this platform. Deal flow is poor (zero deals offered at time of this posting while other platforms have dozens available). They have mix of debt and equity deals which is nice for people that want options of both types of offerings. Returns and due diligence are fair. I think biggest issue is deal flow, but seems like in the past they had better deal flow but quality of deals was poor so hopefully they can figure out a way to have good quality and quantity of deals.

Alon Levy

Jul 24, 2018

Out of about 8 -10 deals both debt and equity, 6 are now in some kind of dispute resolution. Seems like the pressure to produce deals have put the controls side of deal due diligence aside for these people. 

Over 50% of my money with them is more likely to default at this point. This is my own personal estimation as the platform does not provide realistic updates and expectations. 

One of the investments I have with them is with a sponsor that inspite of the fund contract, collateralized the base assets of the fund to another lender to fund his other defaulting funds. Where are the controls RS? 

 

 

Craig Nelson

Apr 01, 2018

I have invested in over 20 deals.

As compared to other platforms my experience has been that: 1) fees charged are above average, 2) depth of sponsor due diligence is not there and 3) receiving regular quaterly sponsor communications regarding deal performance is sporadic. 

I have been an investor in deals on RS's platform since mid 2014, but have decided to avoid donig any further business with them while waiting for my deals to go full cycle.  Investor Relations department, while trying to do a good job, seems otherise overwhelmed with chasing up on deal issues that customers have raised....much of it RS's own making because of #2 above.

Gary Rebensdorf

Mar 12, 2018

I have been doing business with them for nearly three years now. Some good, some not so good.  As mentioned by Dan Smith below, communication is horrible. While most of my investments with them are small, I feel like I am one of the few that ask for status updates from their sponsors.  I understand some of the folks they lend our money to and are behind probably avoid RS like the plague.  Kind of figured it was RS's job to jump in on behalf of the investors.  Can't see myself placing any more dollars with them.  One project in foreclosure hasn't made payments since last summer.  Another house now for sale in the Silcon Valley is about $1MM shy of the projected sales price.  Hope to come out close to whole on it.  Not much DD on their side!

Dan Smith

Aug 10, 2017

I would highly recommend avoiding this platform.  I have 6 relatively new investments with RS that are too early to evaluate.  It is not the investments that are the problem, it is RS total lack of internal controls, updates and overall communication.

I experienced two major issues in my two plus months on RS.  The most recent was a major investment where RS debited my account TWO MONTHS prior to the deal closing and prior to their accrual date. The deal still isn't closed.  I call RS 3 or 4 times over this two month period and several times received no return phone call.  On the one occasion that someone returned the call, they stated that closing had been delayed and had no further information.  I finally called and indicated that I wanted out of the investment.  At that point, RS acknowledged debiting my (and all other investor) accounts PRIOR to having a firm closing date which they acknowledged was against their own policy.  Despite verbally acknowledging that RS had erred in debiting investor accounts, I received an e-mail update from the investment manager stating that the issue was with the lender not closing timely.  I requested compensation from RS due to their early debiting error.  While they again acknowledged their error, they refused compensation.  RS is allowing me out of the deal, but requires two different forms be signed multiple days apart and indicated it would take up to two weeks to get the erroneously debited investment back.

The other major issue was at the beginning of the process.  RS was unable to debit my bank account via ACH for my first investment due to a bad account number.  While I certainly bear resposibility for missing a digit in my account number, there are two issues with RS internal controls that surfaced.  First, RS does NOT require you to enter your bank account number twice for verification like every other financial institution I've ever dealt with.  Second, in resolving the issue, RS had one of their IT personnel access my complete banking information and confirm it back to me.  Clearly, banking information with RS is NOT secure.

Some of this could be growing pains, but after two significant issues within about two months and RS poor handling of both issues, I have decided to not use RS in the future.

Glenn Gerisch

Jul 10, 2017

 I started with this platform after RM stopped offering residential debt. They have a good mix of deals and frequently post smaller debt offerings, but you have to move fast as they often close in less than an hour. They need to improve the timeliness on the postings for project updates. If the sponsor doesn’t provide one, they don’t seem to follow up.

Suhail Mohammed

Jul 07, 2017

I have done about 7 debt deals so far on RS, both commercial and residential debt. I really like the fact they they offer commerical ones as well as compared to other debt platforms which are just SFH. Its a way of diversification for me. Performance has been as expected so far, but lets see how it goes over time.

Jack Reidy

May 02, 2017

I have been investing CRE sites since early 2013 when this genre began to form. I personally have invested in 10 different Crowdfunding sites and researched 25 others.

Realty Shares has moved up the leaderboard in my opinion and they are one my three "go to" sites for investing in real estate.

Here are my results thus far:

Average return of 16.16% on 15 closed deals. Highest Annualized return of 42% and lowest just shy of 3%. No loss of principal and a wealth of options between debt, equity, residential and commercial.

I have 25 existing opportunities in various phases and happy with how things are progressing.

There have been problems along the way and there are Sponsors who do not work out well which have been listed previously.

All in all, I think RS is one of the better sites for accredited investors.

 

James Bobbett

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.

George Dai

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.

H S

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.

D J

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.

James Mc Ree

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.

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Realty Shares Realty Shares
Rated 2.2/5 based on 29 customer reviews

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.