Автор: | Fundrise At a Glance | |
|---|---|
| Open to Non-Accredited Investors? | Yes |
| Fees | 0.15% advisory fee for all Fundrise assets plus 0.85% for real estate funds, 1.85% for innovation fund, $99 per year for Fundrise Pro |
| Account Minimum | $10 for investment accounts, $1,000 for IRAs |
| Investment Selection | Wide range of real estate equity and debt available through funds and individual projects |
| Dividend Frequency | Expected quarterly, although not guaranteed |
| Website Transparency | After brief login, website is transparent, with most information readily available (may have to drill down to get to disclosures and prospectuses) |
| Available Customer Support | Help center and email available Monday through Friday |
How Does Fundrise Work?
Sign up for an account online and select an investment plan. Choose from a Growth, Income, or Balanced Portfolio. Each portfolio includes dozens of alternative assets, such as commercial, industrial, and residential debt and equity. Venture capital investors can access the startup fund. The fund choices align with your goals and desired strategy. Seeking more control over your investments? Choose a Fundrise Pro membership and select your own investments, where you’ll receive ongoing income and capital appreciation potential.
Key Features
Fundrise
Fees
Fundrise fees are transparent. Every investor is charged an annual advisory fee of 0.15%. This fee might be compared with a wrap fee charged by a financial advisor, to manage your assets.
Additionally, the real estate and venture fund fees are:
- Income Real Estate Fund and all eREITs: 0.85%
- Innovation Fund: 1.85%
The 0.15% advisory fee covers typical platform management such as client dashboards, tax management processing, customer support, and portfolio construction. The fund management fees are similar to the expense ratios that investors pay to mutual and exchange-traded fund managers and cover the costs of administering the fund.
Self-directed, advanced investors seeking greater control over their portfolio might consider Fundrise Pro. Fundrise Pro costs $99 per year or $10 per month.
Transparency
When investing, transparency means you can easily find the critical information needed to make an investment decision, including fees, liquidity, and reporting. Fundrise’s fee structure is clearly spelled out. The liquidity or withdrawal options are also documented. While there are quarterly liquidation opportunities, they are not guaranteed.
To redeem all or part of your shares, you submit a liquidation request.
Fundrise provides a tax package to all investors, which includes reporting data to be included on investor’s tax returns. The customer dashboard includes ongoing investment portfolio details. Live customer service is available to answer any additional questions.
Liquidity
Real estate crowdfunding platforms are designed for long-term investors and the trade-off for higher returns is longer capital lock-up periods. In general, lock-up periods range from several months to years. Fundrise delivers the potential, not a guarantee, for quarterly redemptions.
To redeem all or part of your shares, submit a liquidation request. Liquidations are not guaranteed and are fulfilled on a first-come-first-serve basis. Fundrise investments are considered long-term. Redemptions for Flagship, Income, and Innovation funds and eREITs are reviewed quarterly.
Shares of eREITs and eFunds owned for less than five years might be subject to a penalty.
- Restrictions (investment caps): No penalties for liquidating shares of the Flagship Fund. Depending on how long you’ve owned the eREIT or eFund shares, there may be penalties of up to 1% to liquidate.
- Redemption options: Quarterly liquidation may be available on a first-come-first-served basis after completing a liquidation request form
- Lock-up period: There is a five-year lock-up period for eREIT or eFund shares in order to be eligible to receive the full value of your shares. Although share redemption is available quarterly, it is not guaranteed.
- Total number of investors: 393,000
Investment Selection
The investment selection process begins by choosing a taxable investment brokerage account that requires a $10 minimum or an IRA with a $1,000 minimum. Your responses to several questions uncover the investment plan that best fits your goals. Options are:
- Supplemental income: Cash flow from private credit loans
- Balanced investing: Real estate and private credit securities
- Long-term growth: Real estate assets only
- Venture capital: Very long-term growth potential by investing in startup technology companies
- Custom plan: Fundrise Pro members can create their own investment plans from among the available funds.
Components of each fund will vary as new properties are bought and others are sold, or as debt is paid off. Fundrise provides investment opportunities in real estate debt, preferred equity, and equity, each with differing target returns.
Interested investors can access direct links to all Fundrise assets, including prospectuses and current holdings.
- Fundrise Real Estate Interval Fund (Flagship Real Estate Fund): This fund can invest in commercial and residential real estate debt and equity across a range of commercial real property categories.
- Fundrise Income Real Estate Fund: This fund strives to provide cash flow by investing in commercial and residential real property equity and real estate loans.
- Fundrise Innovation Fund: This startup fund provides investors access to rapidly growing private technology companies in early through later stages of their growth. The investment minimum for the Innovation fund is $10.
The fund investments span 288 active projects. Certain projects might be included in more than one fund. The projects include a range of debt investments and equity investments in both new and existing real estate projects across a range of sectors.
The Venture Capital Fund invests in early- to late-stage private technology-related companies.
Sectors and Domains
Nationwide investments include:
- Storage facilities
- Public REITs
- Industrial properties
- Single-family rentals
- Apartment buildings
- Planned communities
- Commercial real estate
Educational Offerings
The Education Center provides a wide range of written and audio content with a consistent focus on the private real estate, credit, and startup markets. Divided into three tracks, the Podcast, News, and Educational articles are on par with those of competitors. The 22 Fundrise YouTube channel videos are usually short and to the point.
- Onward podcast: Interviews with notables in the investment markets and Fundrise-related guests
- News articles: Related to the platform offerings and strategies
- Investing education: Combination of Fundrise-specific articles and general economic and financial articles
Customer Support
Given the breadth and complexity of offers, customer service is very important. Customer support begins with the comprehensive Help Center. The next customer support tier is an email contact form. The Investor Relations department is available on weekdays only. According to the company, you can request a callback; a phone number is not provided. After login, registered users can access a chatbot from the Help page or in the app.
Trustpilot comments mention a number of complaints. Some of these criticisms could be viewed as a user’s lack of understanding that Fundrise is designed as a long–term investment vehicle and that future returns are not guaranteed.
Fundrise
The Bottom Line
Designed for long-term investors, Fundrise offers a wide variety of real estate debt and equity investments, as well as the opportunity to invest in startup companies, to both accredited and non-accredited investors. You might receive higher long-term returns, but like the rest of the industry, performance is not guaranteed, quarterly redemption windows come with some uncertainty, and early redemptions may be subject to penalties.
The Fundrise platform is transparent and you can view historical returns for each fund. Despite the lack of dial-in phone customer service, email contact is available during the week. Investors can expect an investor relations team response within a day or so. While Fundrise’s low, transparent fees, $10 minimum requirement, and robust educational content make this a top choice for inexperienced real estate investors, the company’s investments come with the long-term time horizons that are common across the real estate crowdfunding industry.
Why You Should Trust Us
Investopedia analyzed 19 real estate crowdfunding companies and scored each based on eight major categories and 38 criteria that are crucial in evaluating the offerings and usability of these platforms. We used this data to review each company for their fees, investment selection, transparency, and other features to provide unbiased, comprehensive reviews to ensure our readers make the right decision for their needs. Investopedia launched in 1999 and has been helping readers find the best real estate crowdfunding platforms since 2020.
Is Fundrise Legit?
Yes. Fundrise is a legitimate company and has been around since 2012. Three of the funds are registered with the SEC, as defined by the Securities Act of 1940, while 10 funds are exempt from registration. Non-registered funds are best for aggressive investors willing to risk all of their capital.
A 2016 Fundrise scandal was reported to the Securities and Exchange Commission (SEC). The company stated that a former employee attempted to extort money from the company and claimed business malfeasance by Fundrise. Investopedia has not uncovered additional information other than the termination of the employee.
Who Is Fundrise Best For?
Fundrise is best for the long-term investor seeking diversification into private real estate and startup markets. Appropriate Fundrise investors will be willing to leave their money invested within the firm for three to five years, or even longer in some cases, and accept high risk in exchange for the possibility of higher investment returns. Sophisticated investors who subscribe to Fundrise Pro might appreciate the opportunity to pick and choose their own investment funds.
Can You Make Money With Fundrise?
Long-term investors have earned an average annual income return of 4.81%, according to the company. The company states annual returns on its “Client Return’” performance page. The specific fund description pages delve into the returns for individual funds.
You might compare this historical platform return with those of publicly traded real estate investment trusts (REITs) or lower credit quality fixed income. Investors can make money with Fundrise, but like the rest of the industry, returns are not guaranteed and the hope of higher returns costs the investor a lack of liquidity available in the publicly traded financial markets.
Is Fundrise FDIC Insured?
No. Like investments held across the rest of the real estate crowdfunding industry, the investments offered by Fundrise are not Federal Deposit Insurance Corporation (FDIC) insured. This type of insurance is reserved for banking products such as checking and savings accounts as well as bank certificates of deposit.
What Is Fundrise?
Fundrise is a real estate crowdfunding investment platform. Small investors can access partial ownership of private real estate and debt offers. This means you will purchase shares in a Fundrise fund that owns apartment buildings, industrial parks, and loans to real estate builders.
Fundrise provides diversification but lacks the liquidity of stock-market investing. You’ll need to keep your money invested within the platform for several months through several years, and early withdrawals are not guaranteed.
How We Review Real Estate Crowdfunding Platforms
To evaluate and review real estate crowdfunding platforms, Investopedia’s team of researchers, data collectors, and industry experts spent nearly two months conducting in-depth industry research, company survey data collection, and hands-on evaluations of 19 companies. We grouped the 38 criteria that we collected, like investment selection and minimums, holding periods, and curated portfolios, into eight categories. We then scored these criteria and weighted the categories to determine which real estate crowdfunding platforms are best for both accredited and non-accredited investors:
- Fees: 15%
- Account Services: 15%
- Investment Selection: 15%
- Liquidity: 12.5%
- Transparency: 12.5%
- Sectors and Domains: 12.5%
- Customer Support and Usability: 10%
- Educational Offerings: 7.5%
Through this all-encompassing data collection and review process, Investopedia has provided you with an unbiased and thorough review of real estate crowdfunding platforms. Read our full process for more information on how we review real estate crowdfunding platforms.
