EquityMultiple is a well-known real estate crowdfunding platform that provides investors access to commercial real estate. Through this platform, investors can professionally manage commercial real estate. It is open only to accredited investors. EquityMultiple allows a minimum investment of $5,000.
The Bottom Line
EquityMultiple combines crowdfunding with a more conventional real estate investing strategy, which has the potential to produce high returns. Unfortunately, accredited investors are the only ones who can access it.
|Varies from 0.5% to 1.5%.
|Investors can earn a special 1% return boost on the first investment.|
- Commercial real estate investments are accessible through this platform
- Potential high rates of return
- Easy-to-use platform
- Available to accredited investors only
- Relatively high minimum investment amount
- A complex and complicated fee structure that changes based on the investment.
EquityMultiple provides accredited investors with access to real estate investments in various markets. EquityMultiple claims to have given investors a return of $39.2 million and differentiates itself from other real estate investing platforms by providing senior debt, preferred equity, and equity investments.
EquityMultiple Is Best For:
- Accredited investors searching for an opportunity to diversify through real estate.
- Investors who are capable of investing a minimum of $5,000 or more comfortably
- People who are interested in purchasing commercial real estate.
A Quick Glance at EquityMultiple
|Requirements for investors||Only accredited investors are eligible|
|Minimum investment||It allows a minimum investment of $5,000. However, some offerings may have higher minimums.|
|Options of redemption||Accredited investors might be allowed to sell shares in private transactions. However, this is not guaranteed.|
|Fees||It varies from 0.5% to 1.5%. However, other fees may apply based on the investment. However, most typically, investment fees are 1%.|
|Selection of investment||● Preferred equity and common equity, mezzanine debt, and senior debt
● 1031 exchanges
● Opportunity zones
|Website usability||EquityMultiple website is user-friendly|
|Transparency of investment||The easiness of finding important information about investment offerings such as risk mitigation efforts, investment fees, risks, how investment returns are distributed to investors, and the process for vetting investments accounts for investment transparency on the EquityMultiple website
|Options for customer support||Monday through Friday, 9 a.m. to 8 p.m. Eastern, by phone, email, and chat.|
Features of EquityMultiple
1. Accredited Investors Only
Individual investors may be allowed to invest in commercial real estate through EquityMultiple, but they must be accredited. Accredited investors are people who have a net worth, or a combined net worth with their spouse, of over $1 million (this excludes the value of their home) or who have earned over $200,000 per year (or $300,000 with a spouse) over the previous two years with the expectation of continuing to do so. Accredited investors may also include people with specific professional licenses or credentials.
2. High Investment Minimum
Depending on the project, the minimum investment starts at $5,000. It is more typical to offer additional shares in increments of $5,000 above the minimum, with a minimum of $10,000. Typically, the minimum investment is $10,000 if you use one of EquityMultiple’s preferred IRA partners and invest through a self-directed IRA.
3. Specialized Investments
EquityMultiple offers opportunity zones and 1031 exchanges, funds, senior debt, mezzanine debt, common equity, and preferred equity. The company also offers a yield-focused short-term note product and an evergreen fund.
4. Easy-To-Use Platform
Accredited investors first open an account. Upon receipt of email confirmation, you can register (including self-certifying that you are a potential accredited investor— however you might not be required to provide documentary evidence of this) and start reviewing the investment offerings right away.
Making a deposit is not necessary to open an account. Still, you could link the funding source online if you choose to invest.
5. High Complex Fees
On EquityMultiple, the majority of investments impose annual management fees ranging from 0.5% to 1.5%, with the majority coming in at 1%. According to EquityMultiple, it rarely, but occasionally, makes money off of investors’ common equity deals.
Frequently Asked Questions
1. Is EquityMultiple A Trustworthy Company?
It is trustworthy because numerous reputable financial institutions and real estate investment firms support it. Their general openness and honesty with their investors are one of the main things that distinguish them.
2. How Much Does Using EquityMultiple Cost?
Although there is no initial fee for using EquityMultiple, there are usage fees for both sponsors and investors. If you invest through them, you may incur fees ranging from 0.5% to 2%, so your total return may not be received. It represents the expense of using their resources and network.
Additionally, you’ll need to put down a sizable sum of money, at least $5000, though $10,000 is far more typical. Keep these numbers in mind when determining whether EquityMultiple will be a good fit for your portfolio.
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Overall, when compared to the many other crowdfunding investment platforms available, EquityMultiple is a fantastic option. They provide relatively decent average returns, and there is a lot of optimism that they will improve over the coming years.
To start making money on this platform, get started now.