Real estate crowdfunding: New model from Infobrij

Before the Jumpstart Our Business Startups Act was passed in 2012, investment in private commercial real estate was the purview of elite investors who learned about potential investments through a personal network of contacts. As a consequence, the average investor had little or no access to the majority of the real estate market. Today, however, investors can participate in the real estate industry through online crowdfunding, or crowdinvesting portals.

The passage of the JOBS Act in 2012 removed many of the roadblocks for marketing real estate investments, and now allows small businesses and startups to raise capital by publicly soliciting investors if specific guidelines are followed. Crowdfunding, which is the ability to sell securities in small amounts to a large number of investors, has been amplified by many factors, including the explosive growth and reach of the internet and online social communities. Potential investors in commercial real estate can now find access to opportunities previously not available to them. As a result, many real estate crowdfunding websites or “platforms” have sprung up over the past several years. In the U.S. alone, there are more than 125 such sites.

Protecting your real estate investment

But while real estate investment opportunities have become more accessible to the average investor, they also come with inherent risks. The standard rule of thumb “the greater the risk, the greater the potential reward” applies. That’s why Infobrij’s online marketplace for commercial real estate investments offers an innovative solution to mitigate those risks.

We recently launched a first-of-its-kind program, the Capital Asset Protection Assurance Program ™ (CAP), and offer it on a select number of our sponsor projects. Overseen by our sister company, Risk Management Corporation Holdings, LLC, CAP is the brainchild of an expert team of developers, investment managers, and risk mitigation professionals. On the projects for which it is offered, CAP is managed to ensure a substantial reduction of risk. This unique risk management warranty is intended to back our vetting and risk management process and aims to protect up to 80% of the principal invested. CAP is the only program of its kind being offered by a real estate investment platform.

The benefits of project oversight

Our team, led by successful developer Brian Barbuto, also provides another service uncommon to the real estate crowdfunding industry. Traditional crowdfunding sites match investors with developers and then walk away. But at Infobrij, we continue to provide support and resources to the project sponsors (developers) to ensure that projects are kept on-time and on-budget.

We stay with the project until completion, which means that every sponsor in our platform has access to the Infobrij team: a team with decades of experience, whose members are uniquely qualified to collaborate with investors, lenders, sponsors, and service providers alike. Our revolutionary model of doing business makes investing with Infobrij a win-win situation.