The first New York City-exclusive real estate investment crowdfunding marketplace called CityFunders has launched. The firm has been privately funded by its four co-founders, David Behin, Jerry Swartz, Ayush Kapahi and Albert Behin.
Crowdfunding seems to be in vogue these days with website like Kickstarter proliferating. We can now add to that several crowd investment firms such as Israel’s OurCrowd and CityFunders.
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The new venture boasts that investors are now able to participate in a wide range of multi-million dollar debt and equity deals including multi-family, hospitality, commercial and industrial properties located in NYC.
Curently they have the ability to invest in the mezzanine loan for the acquisition of a mixed-use apartment building in Manhattan’s Chinatown and the equity of a brand-new, 467 unit luxury rental tower in Long Island City.
CEO David Behin explained his reasons for pursuing this venture to Jewish Business News. “I have been working in real estate for over a decade, and I had successfully syndicated several successful properties when I realized there were a lot more people who wanted to invest in real estate, but didn’t know how to make it happen.”
“People want to invest in real estate because it’s a stable investment, ” he added, “and New York City is one of the best places to invest because our metrics – employment, quality of life and housing – lend themselves to a great real estate market. While there are many crowdfunding companies out there, I feel my team and I, who have almost a century worth of experience and $85 billion in deals under our belt, can serve as the best stewards of people’s hard earned capital.”
So the new fund will help people get their feet wet in the highly competitive field of New York real estate deals if they have no prior experience with it.
As for his expectations for the fund, Behin said, “Like most startups, we’re looking for hockey-stick growth when it comes to our user base, as well as to continue to provide outstanding returns on a consistent basis to our community. You can expect to see more deals in more of NYC’s great neighborhoods from some best-in-class sponsors.”
Investments start at as little as $5, 000.
All deals sourced by the CityFunders team are vetted by a committee of leading New York City real estate developers and investors, they promise.
Following a final committee approval, CityFunders commits funds to sponsors from a secured $40 million credit facility.
“Funding of NYC’s real estate deals is an extremely competitive business – especially for the good deals. For any funding entity, whether crowdfunding or traditional sources of capital, commitment to the deal is key. Without that, Sponsors of good deals will never work with you, reducing the platform to mediocre deals that couldn’t get funded elsewhere, ” said Behin.