RoI, perks, and real benefits

Financial returns on investment is the primary reason for participating in real estate crowdfunding. Depending on the project operators’ income projections and other related factors, yields on investment opportunities can go higher than 20%.

As if the monetary gains are not enough, investors can expect to be incentivized in non-monetary ways. This is especially amid the increase in the number of online platforms, investment opportunities, and project operators.

In order to set themselves apart from their competitors, project operators have gone as creative as sparking “crowd” excitement by offering rewards. A popular example is the Hard Rock Hotel (Palm Springs, California) initiative, as listed in the Realty Mogul portal. The incentive given by the developer is actually an entire set of perks that include free room upgrades, generous room-rate discounts, food and beverage credits, and a couple other VIP freebies.

The HBR portal’s incentives system is currently being formulated to give better satisfaction to investors. However, even at this early stage, it already prides itself in the package of real benefits that are rewards in themselves.

Real benefits

Of course, the real benefits in the crowdfunding activity on property investments lie in the following:

  • Ease in acquiring
  • Ease in diversifying
  • Ease of liquidity.

Ease in acquiring. With placements going as low as $100 in some North American platorms like Fundrise, or AED1,000 through the HBR portal, average investors now have access to opportunities that used to be exclusive to big players or high rollers.

Ease in diversifying. Also because of the high accessibility offered by the new-day syndication model, , investors can readily fund multiple initiatives and, technically speaking, stake a claim in a wider range of prime properties.

Ease of liquidity. Where in the traditional model, investing in real estate relates to illiquidity, crowdfunded opporunities enable investors to unload their crowdfunded “shares” more quickly. Most online platforms like the HBR portal have resale programs, and have well-placed machineries to tap secondary markets.

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