Sharestates
Sharestates is a crowdfunding-based online real estate investment business that focuses on giving loans with a term of 12 months and a minimum individual investment of $1,000, typically lending 40-50% - up to a maximum of 80% - of the property purchase price.
Sharestates underwrites their projects using a 34 point underwriting and risk assessment system; the projects they choose to list on the site are sponsored by professional property owners and real estate developers.
Currently roughly 80% of the capital Sharestates raises through its online platform comes directly from investment funds, and only 20% from crowdfunding investors in the strictest sense.
As of June 2017 Sharestates had originated over 520 crowdfunded real estate loans totaling over US $519 million.
History
Sharestates was founded by CEO Allen Shayanfekr, along with Atlantis Organization founders Radni Davoodi and Raymond Y. Davoodi in 2014 in Great Neck, New York. The platform was officially launched in 2015 and has become one of the fastest growing real estate crowdfunding marketplace, doubling every year since launch.
In May 2015, Texas-based Ranger Direct Lending Fund agreed to invest up to $30 million through Sharestates. It has since exceeded this amount in investments.
In October 2016 the company announced that it reached US$1.3 billion in funding capacity.
In May 2017, Sharestates launched a new financing capability called 'Shareline Solution', which they describe as a hybrid between lending and brokering a loan. It allows private lenders to have access to Sharestates lending capabilities to directly serve their clients under their own brand, a process known as white-labeling or 'correspondent lending'.
In June 2017, Sharestates announced an Auto-Invest tool, which allows investors to automatically invest in projects based on multiple strategies, including a custom investment strategy which includes 12 underwriting filters to choose from.
Sharestates has also been raising funds through the crowdfunding platform SeedInvest.
Regulation
Online real estate crowdfunding is subject to current investor protections written into US FINRA and SEC regulations, which include rule 506 of Regulation D, Regulation A and The JOBS Act. While the JOBS Act made crowdfunding much more feasible, real-estate crowdfunding is still open only to accredited investors and not yet openly or easily available to retail investors.
Sharestates is thus only available to Investors/Lenders who are deemed accredited investors by US regulatory bodies and foreign, non-U.S. investors. There are currently no regulatory restrictions on who can qualify to borrow via Sharestates.
See also
- Crowdsourcing
- Peer-to-peer lending
- Crowdfunding (Real Estate)
- Non-bank financial institution
- Hard money loan