Frequently Asked Questions

FAQ Investors

About CrowdStreet

  1. Q: How does CrowdStreet work?
    A:We provide accredited investors with access to real estate investment opportunities that are managed by real estate professionals. After completing an application, Investors can browse investment opportunities, learn about the sponsors, view the details and sign legal documents online.

  2. Q: How does CrowdStreet make money?
    A: Real estate sponsors pay CrowdStreet a posting fee to promote offers on the marketplace, which funds the operations of the site. It is 100% free for investors to make investments, there are no hidden fees.

  3. Q:  Are the deals sold on the website owned by third-party sponsor(s) only, or does Crowdstreet have a Limited Partnership stake in the deals as well?
    A: CrowdStreet only provides the platform for investors and sponsors to conduct transactions, and does not own any stake in the deal.

  4. Q: Does Crowdstreet sell deals that are sponsored or co-sponsored by the company itself?
    A: No. Crowdstreet does not own any portion of the deals that are offered on the site.

  5. Q: Do employees invest in the deals?
    A: Investors on CrowdStreet must be accredited, earning $200,000 or more for two consecutive years. Most CrowdStreet employees do not fall into that category and so are not eligible to invest.

  6. Q: Why should I invest with CrowdStreet?
    A: CrowdStreet offers accredited investors access to opportunities that were previously only available to private or institutional investors. By providing direct access to these opportunities, CrowdStreet gives accredited investors a larger pool of investment options. And with CrowdStreet, accredited investors are able to invest in several projects in different geographic markets to both target and diversify their investment opportunities.

  7. Q: What are the benefits of using CrowdStreet?
    A: CrowdStreet makes it easy for accredited investors to access a variety of real estate investments, across a number of geographic markets and with a relatively small amount of capital. By providing direct access to institutional quality investment opportunities with professional real estate companies, we believe that CrowdStreet investors will gain unprecedented access to a pool of opportunities that was previously only available to an elite few. 

  1. Q: CrowdStreet is an early-stage company. Does that present a risk to the investment I make through CrowdStreet?
    A: No. CrowdStreet is a facilitator of real investments, not an investment manager. We only present opportunities that have experienced, real estate managers in place to manage the assets after the closing.

Investing in Commercial Real Estate on CrowdStreet.com

  1. Q: What types of property can I invest in?
    A: CrowdStreet features both equity and debt investment opportunities, including multifamily, retail, office, industrial and land opportunities. In addition to traditional direct investments, CrowdStreet will feature other structured investment vehicles offered by professional real estate companies, which could include a basket of targeted real estate assets. If you are interested in other types of real estate investment, please contact us.

  1. Q: How does an investment get listed with CrowdStreet?
    A: CrowdStreet’s mission is to match institutional quality opportunities with the types of investments that our accredited investors are seeking. Once we have identified the types of deals that our accredited investors want, we access our network of professional real estate companies to identify specific opportunities that should be presented to accredited investors.

  2. Q: What standards are used for posting properties on CrowdStreet?
    A: CrowdStreet comprehensively reviews the terms and details of all potential postings and rejects investments that do not meet our standards.  To  review these standards in detail, please see our Posting Policy.

  3. Q: Is CrowdStreet a Real Estate Investment Trust (REIT)?
    A: No. REITs are typically large corporations that hold a wide variety of real estate investments. REIT investors have no control over the investments made by the REIT managers and, therefore, they lack specific information about the investment properties.

    While REITs can provide worthwhile investment opportunities, we believe that individuals will benefit from direct access to real estate investments by selecting the markets, locations and properties they prefer. Moreover, there is a large segment of the real estate investment market that is too small for REITs to address efficiently. This gap provides an opportunity for small and medium size real estate companies, which CrowdStreet investors can benefit from.

  4. Q: Can I do a 1031 exchange through CrowdStreet?
    A: CrowdStreet is a real estate crowdfunding platform that brings together a variety of Sponsors and Investors. In some cases, Investors may be able to exchange proceeds from a previous investment into an investment opportunity they found through CrowdStreet. However, because we are not tax advisors, we cannot advise you on the applicability of tax law. If you are considering a 1031 exchange, you should consult with your tax advisor.

  5. Q: After I invest in a deal, who will be responsible for managing the investment?
    A: Every investment opportunity presented on CrowdStreet is managed by a deal “Manager” or “Sponsor”.  Before you decide whether to invest in a deal, you will know who the manager is and will be provided access to detailed information about them. Typically, the manager is a professional real estate company or entrepreneur with significant experience managing real estate assets.

    After an investment is completed, the manager will be responsible for making all of the day-to-day decisions and for providing regular updates to the non-managing investors. For example, the manager would determine how much profit to distribute to the investors or whether to hold or sell the property. In some cases, the manager may be required to present a decision to the investors and the investors may be allowed to take action if the manager defaults on the terms of the agreement or is grossly negligent.

  6. Q: How do investors get a return on investment?
    A: As an investor, you will receive a return on your investment when the company distributes money. This will depend on whether you choose an equity, debt or hybrid investment. Typical distributions made to investors are: as a share of profits for equity investors; at an agreed upon interest for debt investors; and/or when the investment property is sold.

  7. Q: Am I allowed to resell my investments?
    A: The real estate investments you find on CrowdStreet are private transactions and are not traded on public stock exchanges and cannot be easily sold or traded. Prior to investing, you should consider the likelihood that you will be holding this investment for an extended period of time.

    Every investment will have a different anticipated holding period, which could range from a few months to several years. In most cases, the documents that you receive prior to investing will include the manager’s estimate of the holding period and any restrictions on transferring or selling your investment interest.

  8. Q: Once an investor has transacted an investment, what do they really own?
    A: Investors

  9. Q: Are these investments risky?
    A: Yes. As with any investment, investing in real estate presents certain risks and there is no guarantee of future outcomes. The real estate market has economic cycles and it is difficult to know how and when the economy will change.

  10. Q: Are there fees for investors?
    A: No. There are no investor fees for joining CrowdStreet and accessing the investment opportunities.

How the CrowdStreet platform Works

  1. Q: How do I create an account on CrowdStreet?
    A:There are two ways to create a CrowdStreet account. Investors can create a personal account by providing a name, phone number, email, city, and state, or they can create an account using a LinkedIn, Facebook, Google+, or Twitter profile.

  2. Q: How do I delete an account on CrowdStreet?
    A: Investors can close an account by contacting the investor relations manager, or by completing the form below. [add a form that routes to JR].

  3. Q: How does the investment process work?
    A: When an investment opportunity is listed on CrowdStreet, you will receive a notification from us so that you can access detailed investment information, including the minimum investment sought for a specific opportunity.

    When accredited investors commit to invest in an opportunity, we hold those commitments until the minimum investment amount has been committed. Once the minimum is reached, the closing process will occur. Therefore, your investment is not final until the minimum investment target has been reached, all of your legal documents are signed and the funding has been secured. Once the closing is complete, you will receive a copy of the final closing documents.

  1. Q: How do investors view deals on CrowdStreet?
    A: Anyone can view the current offerings on CrowdStreet’s marketplace by clicking the “Offerings” link in the navigation or by clicking on a deal from our home page. You will be requested to create an account to view the offerings, if you have not already done so.

  2. Q: What happens after an investor clicks the “Invest Now” button?
    A: Clicking the “Invest Now” button on any offering on the CrowdStreet marketplace initiates the offer process where investors can enter an offer amount. Once submitted, the sponsor will either approve or deny the offer. Investors and sponsors are prompted by alerts in CrowdStreet and via email when an action is required.

  3. Q: How are funds transferred to purchase investments?
    A: The investor can authorize an automatic funds transfer or send a check. CrowdStreet does not track funding directly as this would require integration with the bank or title company. The system tracks that the funds were sent, and transactions are approved when escrow funds have been received and recorded.

  4. Q: How long does it take to transact a deal on CrowdStreet?
    A: The time it takes to transact a deal on CrowdStreet is directly related to the timeliness of sponsors or investors to submit required documentation and authorize each step. Typically, this takes anywhere from three business days to one week, although theoretically could take less or more time.

  5. Q: How do investors communicate with the sponsor?
    A: Investors and sponsors communicate via the CrowdStreet Transaction Center, accessed after an investor makes an offer on a sponsor’s offering. For some sponsors, CrowdStreet administers the experience, but the sponsor has complete authority and visibility over every communication.

  6. Q: How much does does it cost to invest in a deal?
    A: The minimum investment on CrowdStreet is $25,000.

Investor Security

  1. Q: Is the CrowdStreet platform secure?
    A: Yes. We take your privacy very seriously and will protect your personal information using the latest, proven security technologies. If you would like more information, please read our Privacy Policy.

Accredited Investors

  1. Q: What is an accredited investor?
    A: CrowdStreet recognizes the U.S. definition of accredited investor as someone who has a net worth of at least $1 million (USD), excluding the value of her primary residence. Or an individual earning at least $200,000 each year for the last two years (or $300,000 together with her spouse if married) and will earn the same or more in subsequent years.

  2. Q: Who is allowed to invest through CrowdStreet?
    A: Presently, only accredited investors will be able to gain access to the investment opportunities featured on CrowdStreet. Typically, these high net worth individuals are interested in investing in real estate, but want to invest smaller amounts with a group of other investors and prefer not to manage the underlying real estate assets.

  3. Why are only accredited investors allowed to participate?
    A: Federal laws require that companies register with the Securities and Exchange Commission (SEC) prior to  selling any securities to investors. These laws are designed to protect investors. However, there are certain exemptions to this registration requirement.

    One exemption from registration is provided by Regulation D, which  allows companies to offer securities to “accredited investors” in a private offering.Accredited Investors are defined by the SEC as individuals with income exceeding $200,000 annually ($300,000 per couple) with the expectation of that continuing, or a net worth of more than $1 million, excluding the value of the primary residence.

    To comply with these laws, CrowdStreet investment opportunities are only accessible to accredited investors through our secure and private platform.

  4. Q: Can international investors participate?
    A: International investors are assessed on a case-by-case basis with input from the sponsor.

  5. Q: How does the JOBS Act impact CrowdStreet?
    A: The JOBS Act was signed into law on April 5, 2012 by President Obama and is currently under an SEC rulemaking period. The JOBS Act was designed to loosen some restrictions related to who may invest in private offerings and how those offerings could be advertised.
    In the future, when the SEC completes its review and drafting of the updated regulations, CrowdStreet may provide access to non-accredited investors for qualifying investment opportunities. Until such time, CrowdStreet will be only be available to accredited investors.

  1. Q: How do investors prove accredited status and why do they need to do so?
    A: The SEC requires verification that accredited investors meet the standard requirements. There are two ways to prove accredited status:
    1. A letter written by the investor’s CPA or attorney (on personal letterhead), verifying that the investor is accredited.
    2. Certification provided by a 3rd party verification service. CrowdStreet investors can use VerifyInvestor, a service built in to the CrowdStreet marketplace. 

FAQ - Investor

Posting an Offering

  1. Q: What types of property postings does CrowdStreet accept from sponsors?
    A:We post commercial and investment real estate in the United States including retail, office, industrial, mixed-­use, multi­family, hospitality, senior housing and storage. These can be stabilized offerings with steady cash-flow, redevelopment projects, ground-up developments, or built-to-suit.

  1. Q: What vetting criteria is involved in determining whether a sponsor or offering can be published on CrowdStreet?
    A: CrowdStreet requires that sponsors have a 10+ year track record of success, completing ten or more private investment real estate offerings. Offers posted on CrowdStreet must be accompanied by a business plan. The CrowdStreet team reviews each offer and must pre-approve before the offer is posted to the marketplace.

  2. Q: What is the average value of properties listed on CrowdStreet?
    A: The target property value range is between $2,000,000 and $25,000,000. There is no maximum property value.

  3. Q: What are the fundraising goals for a typical CrowdStreet offer?
    A: Sponsor’s target fundraising goals from CrowdStreet typical range from $500,000 to $2,000,000.

  4. Q: What information does CrowdStreet require sponsors to provide to investors?
    A: Sponsors are required to provide quarterly reports to Investors via the CrowdStreet Investor Dashboard. In addition, Sponsors are responsible for Investor distributions and tax matters.

  5. Q: How much risk will sponsors be required to share with investors?
    A: Sponsors are required to fully disclose the risk profile of particular property or fund. A sponsor generated Private Placement Memorandum (PPM) is strongly encouraged or required depending on the offering.

CrowdStreet Professional Services

  1. Q: Once my offering is accepted to post on CrowdStreet, what do I get for my posting fee?
    A:  CrowdStreet will create marketing collateral for your listing, including a website, videos, emails, and display advertisements. This content becomes the source for digital marketing campaigns that include social media, search marketing, and webinars to increase awareness for the offering and generate qualified leads. Our account team handles inquiries and administrative tasks of attracting new and existing accredited investors to participate in funding.

  2. Q: I don’t have a website, can I still promote my CRE offerings on CrowdStreet?
    A: Yes, although it is recommended that our sponsors have a website to support the credibility and build trust with accredited investors. CrowdStreet offers website development services built upon modern website architecture that is secure and supports mobile engagement.

Sponsor Direct

  1. Q: What are the requirements for hosting Sponsor Direct on the sponsor’s website?
    A: The sponsor has to have a website that is capable of integrating with the technology framework that Sponsor Direct is built on.

Q: Can I use both the CrowdStreet Marketplace and Sponsor Direct?
A: Yes. CrowdStreet Marketplace is intended for gaining visibility for deals, and attracting new investors. Sponsor Direct is an investor relations management platform that is designed for sponsors to host deals on their individual sites, and then manage investor relations independently from CrowdStreet.