​According to the below linked article on entrepreneur.com it looks like REITs (real estate investment trusts) have new competition for real estate investment dollars. People are investing their real estate investment money into real estate crowdfunding.

According to this article there are 85 current real estate crowdfunding platforms a real estate investor can choose from. Which begs the question, which platform should the real estate investor choose? How does an investor ensure that he/she obtains the most amount of returns for his/her investment while still protecting his/her downside?

One benefit of having a group (or crowd) of individuals invest together is that the group can have access to investments or properties that they wouldn’t otherwise have access to because that group pools their monies for a larger dollar amount. The problem, or negative with pooling a group of investors is a single investor usually does not have very much (or usually even a small amount) of say in a particular investment. This can become frustrating if an investment is very close to being ideal but just needs a few legal or financial “tweaks”. Usually in these types of situations a smaller investor may not have as much leverage or pull over the entire “crowd” to make a small adjustment to the purchase that would benefit the investor. An adjustment that the individual may have otherwise had in a smaller transaction.

Finally, the article states that technology in crowdfunding allows for the transaction to go much more “swiftly”. This can be both beneficial and detrimental. Beneficial sometimes in getting to a deal or getting a deal done but detrimental because a lot of larger real estate transactions need due diligence in order for the client to be properly protected.

Investing in such crowd funds do sound intriguing and can be very profitable. As in most commercial real estate purchases or commercial real estate sales LOKK Legal assists its clients with, the devil is in the details.