CrowdStreet Marketplace performance has crushed the competing online real estate investment platforms. In the process of building 361 real estate investment offerings since 2014, CrowdStreet has seen 17 offerings fully realized at an average annualized return of 25.5%.
In addition to information about what unique traits this company has to offer, and historical funds data, this review will provide the most up-to-date BBB rating and customer reviews so you can determine if it’s a good fit for your portfolio and your wallet.
What is CrowdStreet? (Review)
My CrowdStreet QUICK-LOOK Review
Company Name: CrowdStreet Inc.
Company Website: https://www.crowdstreet.com/
Founders: Tore C. Steen and Darren Powderly
Minimum Investment: $25,000 *ACCREDITED INVESTORS ONLY*
Investment Term: typically 5+ years (there are currently some individual offerings at 2-3yrs)
Account Fees: acquisition/disposition fees up to 2%; property management fees 3% – 4%; asset management 1% – 2%; construction management up to 5%; development fees up to 5%; any or all fees where applicable.
Annualized Yield: average of 25.5% on all realized deals
Property Types: residential, multi-family apartments, multi-tenant office buildings, hotels, restaurants, retail centers, medical buildings, mixed-use, industrial, land, storage facilities with cash flow and/or equity value in the USA
Accolades: Forbes, CNN, The New York Times, VentureBeat
RELATED: Not an Accredited Investor? Consider a REIT with a low initial investment and an early Redemption Plan What is Streitwise? (Review) Should You Invest?
Open to Accredited Investors Only
Before you get too excited about an average annualized return of 25.5%, let’s make a clear understanding that at this time, the CrowdStreet offerings are only available to Accredited Investors.
What is an Accredited Investor?
In layman’s terms, it means that you need to be a high income, high net-worth individual or entity, and to invest at CrowdStreet, you will be required to submit proof of your Accredited Investor status.
According to the SEC, an Accredited Investor must:
- Earn an annual income per individual of over $200,000 per year ($300,000 per couple) with the expectation of maintaining such level of income in the future.
- Have a net worth of more than $1 million (individually or jointly), excluding the value of a primary residence.
- Be a bank, insurance company, registered investment advisor, business development company, or small business investment company.
- Be a general partner, executive officer, director or a related combination thereof for the issuer of a security being offered.
- Be a business in which all the equity owners are accredited investors.
- Be an employee benefit plan, a trust, charitable organization, partnership, or company with total assets in excess of $5 million.
If you qualify as an Accredited Investor, then you’ll want to continue with this review. If you’re looking for an online real estate platform that is open to non-accredited investors (aka the average Joe), then skip down to this section to see reviews of other online real estate companies.
My CrowdStreet FULL Review
CrowdStreet opened its online doors in 2014 with the idea that investors deserved to have direct access to institutional-quality assets and real estate developers who desired to be less dependent on traditional capital market funding.
Today, CrowdStreet is known to be “the largest and most diverse commercial real estate marketplace.”
You won’t find this many quality options online anywhere else.
Three Ways to Invest at CrowdStreet
1. Marketplace Investment Funds
2. Individual Marketplace Deals
3. Custom Tailored Portfolios
The CrowdStreet Marketplace Investment Funds
An Affordable Way to Get into Real Estate
All things considered, yes. Crowdfunding has made it possible for non-millionaires to invest in multi-million dollar assets. People who once considered real estate investing out of their league now have access to portfolios full of diversified residential, commercial, and industrial real estate.
The Details on the Marketplace Investment Funds
There are MANY funds available to choose from. These are pre-structured portfolios containing multiple properties.
Here are 2 examples of currently available funds:
1. CrowdStreet Blended Portfolio – Fall 2019
- Minimum Investment – $25,000
- Targeted Investment Term – 5 to 10 years
- Targeted IRR – 18%
- Targeted Equity Multiple – 2.5 x
- Distributions – Quarterly
2. CrowdStreet Opportunity Zone Portfolio
- Minimum Investment – $100,000
- Targeted Investment Term – 10 to 12 years
- Targeted IRR – 10% to 13%
- Targeted Cash Yield – 6% to 7%
- Targeted Equity Multiple – 2x
Account Minimum Investment:
This seems to change, but the current minimum investment amount for any investment is $25,000.
(To check this at any time, visit the Marketplace tab on their Homepage, and use the Filter to select Deal Terms and Minimum Investment.)
The Potential Return:
This varies greatly, as there is a vast number of options at CrowdStreet. Visit the CrowdStreet Marketplace to see targeted returns listed by each fund or individual offering.
Must-know Investment Information:
First of all, as we’ve already mentioned, it’s important to understand that only Accredited Investors can currently invest in CrowdStreet real estate projects.
Previously, CrowdStreet had offered funds to both accredited and non-accredited investors, and you could get started for $5,000 with the Medalist Diversified REIT which closed in 2018. Currently, though, they are taking on accredited investors only.
You must be accepted as an investor.
This isn’t a sign up and send in your money kind of platform. You must apply to become an investor, and they will let you know if you’ve been chosen for the investment deal. Per the CrowdStreet FAQs page:
“When you request an investment in a CrowdStreet offering, your request is added to a list of other interested investors. Once the minimum investment amount is met, the project Sponsor will review all investor requests. As soon as a Sponsor has selected the investor offers that will be accepted, CrowdStreet will contact you with your allotment information. And you will be provided with a complete set of documents to complete your investment.”
The CrowdStreet Individual Marketplace Deals
Want to hand-pick your own portfolio of properties?
If you’d prefer to build your own portfolio, just head over to the Individual Marketplace Deals where you can select and invest in individual projects rather than a pre-structured collective fund.
The CrowdStreet Custom Tailored Portfolios
Not interested in an already constructed fund, but don’t have the expertise or time to select individual properties?
You can have a professional CrowdStreet Portfolio Manager custom build your real estate portfolio based on your desired investment strategy and long-term financial goals.
What the CrowdStreet Investments Offer
- Real estate is an alternative to the volatile stock market, often with a higher average yield. Real estate investments have long been a way to create wealth with a lower risk of loss and a bit of inflation protection.
- ACCREDITED INVESTOR STATUS – HIGH DOLLAR MINIMUM INVESTMENT
- $25,000 minimum investment in any project
- NO BROKER FEES
- However, there are Sponsor and Account management fees as described at the top of this article
- PROFITABLE TRACK RECORD
- With some pretty impressive returns to date.
- CUSTOMER SATISFACTION
- Average 4-star reviews by investors
- Acclaimed by Forbes, CNN, The New York Times, and VentureBeat
What Does the BBB Have to Say?
CrowdStreet Inc has been filed with the BBB since 2014, and currently has an A+ rating. To check their status for any changes or updates, visit the BBB website.
There are no complaints filed at this time.
There is one 1-star review by an individual stating he received his investment back without any return. While we can understand his frustration, as the intent with an investment is to make money, there is no guarantee in any investment, and there is always the possibility of losing your entire investment. Also, he stated that he requested his return at 8 months, when these are clearly designed and described as long-term investments.
Around the web, CrowdStreet hovers around the 4-star mark including Google and Facebook reviews. The most positive of comments praise the extent of diversification and large amount of funds to choose from when investing.
The PROS and CONS
Overall, the CrowdStreet website is pretty impressive. It’s very easy to navigate, with each investment category having it’s own page of detailed offerings including beautiful photos of the properties.
There’s a very helpful page titled “Compare Investment Options” that can be used to determine which approach is the best approach for your individual needs.
- A+ BBB Rating
- Vast Selection of Investments
- Distributions – some cash-flowing funds are set up to deliver monthly or quarterly distributions
- Current track record of average annualized returns of 25.5%
- we found one property with an actual return of 66.5% – click to view performance record.
- Only Accredited Investors can gain access to CrowdStreet’s real estate investment opportunities.
- Minimum Investment Amount is $25,000 currently, when there have been lower offerings in the past.
- Fees may be high on some deals (but may be justified as most returns are higher than industry average – you get what you pay for? Sponsor Fees Explained)
- Most of these are designed to be very long-term, so you must be prepared for your money to be locked-in for several years.
How Do You Become an Investor?
You Can Request to Invest in 4 Steps:
1. Create a Free Account
- Set up your Profile with your:
- E-mail address
- Phone Number
- Accredited Investor Status – You cannot set up an account without checking Yes.
- Alternatively, you can login with your Google or LinkedIn Account.
2. Select Your Investment Type
- Browse all active funds and select the one that best fits your investment objective.
3. Make Your Investment
- Choose your investment amount and sign the necessary documents.
- They will let you know if you are accepted as an Investor, and offer you an agreement.
4. Monitor Your Investments
- Track and manage your account online
- Receive account statements
- Receive annual tax documents
* Disclaimer – BYIO is not providing investment advice. BYIO is not promising a return on your investment. BYIO suggests you consult with your financial professional, or make sound judgment on your own, when debating investing in CrowdStreet or any other investment platform. We’ll keep sharing what information we have, and we hope you make a lot of money!
Some CrowdStreet FAQ’s
1. Why CrowdStreet?
CrowdStreet is the largest, most diversified, online crowdfunded real estate platform for Accredited Investors, with a higher than average annualized return.
2. How do I get a return on my investment?
While there is never a guarantee of return or protection of loss, the anticipated returns come from both equity and debt investments. So, you will receive a share of profits or interest, when the deal is closed or property is sold.
3. Can I contact somebody at CrowdStreet if I have a question?
Yes. Here is their Contact Information:
Phone Number: (888) 432-7693
E-mail: firstname.lastname@example.org OR https://www.crowdstreet.com/contact
You can also find them on these social media platforms:
Facebook | Twitter | LinkedIn
Who are CrowdStreet’s Competitors?
While CrowdStreet leads the way for Accredited Investors to invest in real estate online, the following companies are open to both accredited and non-accredited investors with much lower initial investment requirements:
Click to read our DiversyFund Review. Minimum initial investment is $500, and there is no early redemption plan.
Click to read our Realty Mogul Review. Minimum initial investment is $5,000.
Click to read our Fundrise Review. Minimum initial investment is $500.
Click to read our Streitwise Review. Minimum initial investment is $1,000 – and they offer an early Redemption Plan!
Click to read our Rich Uncles Review. No minimum initial investment required.
To name a few. This list could go on and on. So, if real estate is your current focus, there are many more companies to research! We’ll keep providing the reviews, and we hope you find the right company to invest your money in real estate.
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