CrowdStreet Alternatives To Invest In Private Real Estate

CrowdStreet is one of the leading private real estate platforms for accredited investors. This article will look at the main CrowdStreet alternatives to invest in private real estate across the country.

For background, I have invested $954,000 in private real estate since 2016. In addition, over $150,000 of my $380,000 a year in passive income comes from rental properties and private real estate. Finally, I've been investing in real estate since 2003, when I bought my first property in San Francisco.

Real estate is my favorite asset class to build long-term wealth. Real estate provides shelter, generates income, and is much less volatile than stocks. As a result, if you want to achieve financial independence, investing in private real estate and rental properties should be considered in your portfolio.

About CrowdStreet

CrowdStreet was founded in 2012 by Tore Steen and Darren Powderly is now headquartered in Austin, Texas. It is one of the leading private real estate crowdfunding platforms today.

Unlike Fundrise, a vertically integrated platform, CrowdStreet does not manage or source the deals. Instead, CrowdStreet identifies the the top sponsors with the best track records and introduces their deals onto the CrowdStreet platform. In turn, CrowdStreet earns a referral fee.

CrowdStreet has 776+ funded deals, 344+ project sponsors, and more than $4.16 billion invested in real estate projects across the US. CrowdStreet also has speciality funds on occasion, including its C-REIT and industrial fund.

Because CrowdStreet is for accredited investors only, the minimum investment amount for deals on its platform averages $25,000, but can sometimes go as low as a $10,000 minimum.

CrowdStreet charges a sponsor fee ranging from 1% to 3% of the investment. You can browse the full list of projects, filter, compare fees, and more, from the CrowdStreet dashboard.

CrowdStreet Sponsors

If you are to invest in CrowdStreet, you must thoroughly screen each sponsor. Although the sponsors CrowdStreet chooses have strong track records, things can sometimes go wrong as was the case with the Nightingale sponsor.

Elie Schwartz, founder of Nightingale Properties is under investigation for misappropriating funds raised on the CrowdStreet platform. Instead of promising to buy the Atlanta Financial Center and a Miami commercial property, Elie somehow transferred funds to his own bank account. The case is still under investigation.

As a CrowdStreet investor, it's important to diversify your sponsors and your investments along the capital stack. Build a select portfolio of the best real estate offerings so you are properly protected. 99% of the time the sponsors are legitimate. Spend time reviewing their track record on their website. However, it's still good to diversify as always.

Here is my CrowdStreet review for more details.

CrowdStreet private real estate

1) Best CrowdStreet Alternative: Fundrise

Fundrise is my favorite private real estate platform. It was started in 2012 and manages over $3.3 billion for over 400,000 investors. This article will look at the main Fundrise alternatives in the real estate crowdfunding space.

I have a strong affinity for Fundrise because when I came out with my investing in heartland real estate in 2016, Fundrise ended up launching a Heartland eREIT. Our views about the future of real estate were aligned.

I hypothesized that more people would relocate to lower cost areas of the country due to telecommuting. Once the pandemic hit in 2020, there was a massive acceleration in work-from-home and work-from-anywhere.

Fundrise is was co-founded by brothers Dan and Ben Miller and is headquartered in Washington, DC. The vertically-integrated real estate platform has more than 1.9 million active investors, Fundrise is one of the largest online real estate crowdfunding platforms in the US.

Fundrise Made Private Real Estate Accessible To All Investors

Fundrise is open to all investor and has an investment minimum of just $10. The $10 makes investing in private real estate investing and venture vesting accessible to all Americans. In the past, only accredited investors with net worths of over $1 million or income of over $250,000 could invest in private real estate.

Fundrise has a total portfolio value in excess of $7 billion across 292 active and 145 completed projects. It owns over $3.3 billion in equity. Here is my Fundrise review for more detailed information.

Fundrise is a great way to generate more passive income compared to owning physical rental properties. By investing in a Fundrise fund, there is no dealing with tenants, remodeling, or maintenance issues. As you get older and wealthier, investing in private real estate becomes attractive.

As you build your invest portfolio and gain more experience, you can sign up to be a Fundrise Pro member, which offers more investment flexibility and curated news and information. Click on the image below to join Fundrise and explore.

Best CrowdStreet alternative: Fundrise

2) Second Best CrowdStreet Alternative: RealtyMogul

If you are not an accredited investor, RealtyMogul is the main CrowdStreet alternative. RealtyMogul also began in 2012 and is one of the oldest private real estate investing platforms today. RealtyMogul offers eREIT funds and individual investments.

I personally had lunch with Jilliene, the CEO and Founder of RealtyMogul when she visited San Francisco. I was impressed with her long-term vision and focus on investing in profitable deals as opposed to some platforms that sacrificed quality for growth.

RealtyMogul is open to accredited and non-accredited investors. The average minimum to invest is $5,000, much lower than CrowdStreet's $10,000 – $25,000 minimum, but much higher than Fundrise's $10 minimum.

Here is my detailed RealtyMogul review for more details. Click the image below to explore RealtyMogul and see al it has to offer.

RealtyMogul REITs - CrowdStreet alternative

3) Third Best CrowdStreet Alternative: EquityMultiple

EquityMultiple is another solid CrowdStreet alternative based in New York. EquityMultiple has a total project value of over $4.4 billion as of 4Q 2023. Here is my EquityMultiple review for more details.

EquityMultiple offers two ways to invest in real estate: EquityMultiple Earn and EquityMultiple Grow. With EquityMultiple Earn, you can access high-yielding real estate investments, and the minimum investment is $5,000.

If you’re looking for growth over short-term yield, EquityMultiple Grow is the more appropriate investment. With EquityMultiple Grow, you can invest in a portfolio of value-add and opportunistic real estate projects. Target return average is above 15%.The minimum investment for these is $10,000.

EquityMultiple has excellent reviews on Trustpilot, and they’ve paid out almost $300 million in dividends to investors. Click the image below to sign up and see what EquityMultiple has to offer.

Equitymultiple, a CrowdStreet alternative to invest in private real estate

4) Final CrowdStreet Alternative: DiversyFund

Finally, you might want to check out DiversyFund as a weaker CrowdStreet alternative. DiversyFund was founded in 2014 by Craig Cecilio and Alan Lewis and is based in San Diego, California.

DiversyFund is also open to accredited and non-accredited investors, with a community of more than 300,000 active investors. The investment minimum is just $500, so the second lowest after Fundrise.

Investors can focus on growth, dividend, or retirement – or Premier Offerings if you’re an accredited investor. Most projects listed on DiversyFund have an investing horizon ranging from 5- to 7-years, hence, invest accordingly. Fundrise, on the other hand, provides quarterly liquidity for those who need it.

CrowdStreet Remains A Strong Real Estate Platform

Despite the debacle with the sponsor Nightingale Properties, CrowdStreet should be able to continue growing. It will surely tighten up its screening of sponsors and its funding procedures for all future deals.

If you are an accredited investor who has the time and enthusiasm to invest in private real estate, CrowdStreet is one of the best choices. CrowdStreet offers individual vetted deals and private funds as well.

In general, I think most investors should invest in private real estate funds for diversification purposes. There returns likely won't be as high as individual deals, but you're more protected on the downside.

If you do invest in individual deals, then you should probably build a portfolio of 4-6 deals, which could range between $20,000 – $150,000, depending on the platform and the investment minimums.

My favorite CrowdStreet alternatives are Fundrise and RealtyMogul. If you want to explore CrowdStreet's deals, click here.

About the Author

Sam Dogen is the founder of Financial Samurai, one of the largest and most trusted personal finance websites today with over 1 million monthly readers. Financial Samurai was founded in 2009 during the height of the global financial crisis. Sam worked at Goldman Sachs and Credit Suisse for 13 years and has his MBA from Berkeley. Sam is a 21-year real estate investing veteran. Sign up for his free newsletter.