Key Highlights
- Investors across the board more committed to real estate investments going forward
- Preferred assets focused on multifamily, last-mile industrial and niche asset classes
Real Estate Crowd-Funding Ecosystem Maturing
After the JOBS Act opened the door to fractional, passive real estate investments to accredited investors, the real estate crowd-funding ecosystem was born.
During Q4 2020 and Q1 2021, despite greater volatility and elusive yields in our current low-interest rate environment, accredited investors were enthusiastic about the various types of CRE assets offered via online real estate investing platforms.
Key Takeaways from Survey Research by EquityMultiple
- Investors are more committed to real estate investing in 2021 than they were pre- pandemic.
- Investors focused on multifamily, last-mile industrial and niche assets classes that “appear” to be recession proof.
- Self-directed investors prefer real estate crowd-funding for real estate investing.
Most Favored Types of Real Estate Investments
Investor participants in the EquityMultiple survey overwhelmingly focused on multifamily real estate. In fact, multifamily assets scored 25% higher than industrial assets, the next most-preferred property type. Many multifamily markets across the US are continuing to benefit from low rates of home ownership, diversifying economies (particularly across Sunbelt metros) and notable shortfalls of market-rate housing.
Industrial assets include warehouses, fulfillment centers and last-mile. Clearly, these investors believe e-commerce is here to stay and will only grow.
Niche property types came in third. Niche assets include data centers and self-storage. Cloud services represent the present and future for both data storage and 5G technologies across multiple industries.
What Real Estate Investors Want from Investing Platforms
In a nutshell and in this order, investors want crowd-funding real estate platforms to provide top quality in the following areas:
- Due diligence and underwriting measures
- Deal flow
- Historical track record
- Reporting that includes asset performance and tax documents
- Customer service
These preferences represent the notion that investors using crowd-funding real estate platforms are self-directed investors. They believe they are self-sufficient enough to choose/invest in deals that are consistent with their overall investment strategy.
Thanks to EquityMultiple.
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