Using local investors to build neighborhoods

stlhistory · PostNov 25, 2012#12012-11-25T17:40+00:00

Interesting idea from Washington, DC investment group: It basically involves using a website to recruit small investments from local people to purchase and invest in businesses and commercial property (rather than the current "big investor" model). I've heard so many times the argument of "Well if you really want X building preserved and reused and whatnot, why not buy it with your $1.4 million and do it?" and this takes care of it nicely.

The Atlantic Cities article:
http://www.theatlanticcities.com/neighb ... hing/3897/

The investment website:
https://fundrise.com/

Why not here?

stlien · PostNov 25, 2012#22012-11-25T19:35+00:00

its coming soon.

leeharveyawesome · PostNov 25, 2012#32012-11-25T23:22+00:00

Is this similar to my idea in the thread I started a year ago?

http://nextstl.com/forum/viewtopic.php?f=1&t=8364

This also touches on another thing I mentioned in another post about neighborhoods being organic versus being a failed bureaucratic disaster or just another real estate developer trying to cash in big without any real relationship to their development. The following example is different but still using the same approach.

Let's say there are 25 people with day jobs who also feel passionately about, say, the Alverne. Assume each was perfectly able to walk into a bank and secure a home loan for 150k. Theoretically, couldn't the 25 people walk in together and get a 3.75m loan and "buy" the Alverne? Working to be "profitable" would be a must otherwise nobody would take on the risk but the 25 people are less concerned with the immediate "big payoff" than with whatever desire drove them to take part. Maybe one guy owns a coffeeshop around the corner, maybe one guy can't wait to get to work on the facade, maybe another plans to live in a particularly fantastic part .of the building, maybe another plans to open a business in the the bldg, maybe .another just likes architecture, maybe another expects eventual profits but he's not a greedy a**hole and he has a day job. Ok, I cant continue making this .post on my phone its killing me....

PostNov 26, 2012#42012-11-26T00:12+00:00

Holy sh*t my original and possibly similar post was two years ago. Where does the time go.....

stlhistory · PostNov 26, 2012#52012-11-26T03:09+00:00

It does sound like your idea, with the exception that the DC plan is a smaller scale. The DC plan caps investments at 10K and deals in individual commercial properties by setting up an LLC for each property and then allowing investment in the LLC. It also suggested that each property also had angel investors who backed it in addition to the crowdsourced funding.