Crowdfunding platform for the US real estate sector, PeerStreet, connects retail investors with institutional money. Recently, the company has reported an update on its 2018 performance, which is looking good for PeerStreet. Its originated $1 billion in debt based financing for last year as now amounted to over $1.7 billion in real estate lending.
Management states that, as they grow, more loans creates more data thus improving their underwriting process. PeerStreet says that during the year they made several refinements and added new products to boost diversification and overall asset quality. Options for investors now include commercial real estate, single-family, multi-family plus cash offer loans and 30-day notes. Expect more products to enter the platform.
During 2018, the real estate crowdfunding sector saw a bifurcation of sorts as some platforms struggled, some shuttered their doors, and others thrived. There is not a single model that has been deemed the path to success but multiple models driven by execution and efficacy of management. Some platforms, fueled excessively by the lure of VC money and need to exhibit outsized growth early on, have been the ones to struggle or fail.
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