Previously inaccessible to all but the wealthiest of individuals, investment opportunities in commercial real estate now abound. Numerous platforms offer investors of all wallet sizes and knowledge bases to become an owner.
One such platform is RealtyMogul, a U.S.-based company providing opportunities in commercial real estate. On the surface, it sounds a bit familiar to Canada-based addy, but there are some key differences. Let’s see how they compare and contrast.
What is RealtyMogul?
RealtyMogul is a platform allowing investment in commercial real estate opportunities in the United States. They’ve been around for 10 years and like addy, seek to break down barriers to real estate investment. CRE properties come with high price tags and typically require quite a bit of knowledge – and effort – to buy and sell. RealtyMogul finds properties, conducts due diligence and offers members a chance to invest in this now unlocked asset class – just like addy.
According to RealtyMogul, investors have invested $800 million, financing 400+ properties valued at over $4.7 Billion. addy is quite a bit younger, but we’ve no shortage of milestones to celebrate and distributions to showcase either.
Commercial real estate typically comprises apartment complexes, office parks, hotels, mixed-use buildings and other large business-focused properties. addy exclusively focuses on institutional grade CRE.
Like addy, the investment opportunities on RealtyMogul are not liquid. They cannot be easily bought and sold, and are not publicly traded. That means for the most part, once your money is in, it stays in until the end of the term.
While RealtyMogul offers U.S-based properties, addy unlocks opportunities in B.C., Alberta, Ontario and Quebec.
Who can invest?
Like addy, RealtyMogul welcomes both accredited and non-accredited investors to invest on their platform. However, the latter category faces limited options in RealtyMogul. For those who are not accredited investors – aka, the average investors – their pathways with RealtyMogul include one of two REITs.
A real estate investment trust, or REIT, is a company or group that manages a collection of investment properties. Investors won’t know exactly where their money is going.
addy is not a REIT. With addy, CRE properties are identified and members can invest in specific ones they prefer across Canada. Some members and fans can even visit these properties and take pictures!
With RealtyMogul, the minimum investment varies with each specific case, but generally the lowest is $5,000. That threshold certainly allows for those who don’t make the money that accredited investors earn to get into the market. Still, it’s a high threshold for the average investor and definitely a high bar for someone just starting out on their investment journey.
addy looks to break down all the barriers to CRE investing, including minimum investment amount. That’s why members can put forth as little as $1 toward a single property. What’s more, addy caps the investment amount per property at $1,500 so that everyone has a chance to get involved on their own terms.
Costs and fees
RealtyMogul is free to join, however there are various fees associated with every investment. The fees will vary based on each opportunity with a detailed breakdown available to those interested in investing.
addy operates in a different way. Only members can invest, and while a Charter Membership costs $25 for one year, there are no associated fees or hidden costs with an investment. Every dollar invested goes right to the property.
Invest with addy
For those seeking to start their investment journey – or those already well on their way – addy makes commercial real estate investing accessible. The process for joining is simple and fast; there is no threshold for personal wealth or financial knowledge. You just need to be a resident of age of majority in one of the four unlocked provinces.
Once you’re a member, you can browse available property and invest away. After that, the work is over: sit back, take in the occasional update and await a potential Owners’ Day or even exit to earn some passive income.