WHAT IS IFUNDING?
iFunding combines the capital of many investors to acquire or provide financing for the acquisition of real estate. Our goal is to provide a professionally, diversified portfolio of institutional quality commercial real estate to investors who generally have had very limited access to such investments in the past.
WHAT TYPES OF PROJECTS ARE AVAILABLE TO INVEST IN ON IFUNDING?
For our investors, we select projects after careful scrutiny only. You will be able to invest in multi-family, hospitality, office space, ground-up development and residential properties. Using the search tool, users can select the exact type of investment property they are looking for.
HOW DOES A COMPANY GET LISTED ON IFUNDING?
We have some stringent measures set in place for those wishing to get financial support at iFunding. Property owners and developers can contact the team at iFunding with information about their project. Our team, consisting of experienced real estate finance, development and engineering professionals, then evaluates each proposal thoroughly. We have developed a rigorous check-list of all the points that we'd like to have in an investment project. Each prospective project is measured in regard to that check-list to help us decide if the project is suitable for investment by our clients. We also compile a detailed overview and economic analysis for each project to determine its potential to make you money.
WHY SHOULD I CONSIDER AN INVESTMENT IN REAL ESTATE?
Allocating some portion of your portfolio to a direct investment in institutional quality commercial real estate may provide you with a reasonably predictable and stable level of current income from the investment; the opportunity for capital appreciation; and diversification of your portfolio , by investing in an asset class that historically has not been correlated with the stock market in general.
ARE THERE ANY FEES FOR INVESTORS?
Investors are charged a 3.5% only upon successful capital raise for a project they invested in. We also charge our investors for tracking the project, getting them timely updates and ensure that their money is returned in a timely and appropriate manner. This fee is 1.5% for each year their capital is invested.
WHAT WILL I ACTUALLY OWN?
The investor will own shares or membership interest in a limited partnership, solely set up for each individual project.
WHEN WILL I GET MY INVESTMENT BACK?
Depending on the property type that you invest in, the dividends or profits you receive may be paid out quarterly or in one lump sum when the project is complete. Our first projects will be existing, cash flowing assets where investors will begin to receive checks in the form of dividends 6 months after their original investment.
ARE THESE INVESTMENTS RISKY?
Yes they are. Yet our team of trusted professionals has over 30 years of experience in real estate investing, asset management and have been involved in over $2B of real estate transactions. We have the appropriate due diligence framework in place to provide you best option for a profitable venture.
We do this by painstakingly analyzing each investment, structuring it in a manner where you are not the last one to get paid if a project goes bad and an efficient monitoring system, via our asset management team, that ensures the project is on schedule and the funds are being used per the offering memorandum we share with you. Please bear in mind that the securities and investments found on iFunding are high-risk but high-return as well. There is always the risk of losing your capital.
WHY HAVEN'T I HEARD ABOUT THIS BEFORE?
Crowd funding is a very familiar concept in Europe. But in the United States it has yet to catch on. Since the economic crisis, the Government and SEC govern the process of selling equity and debt securities to accredited investors, and it takes a long time to get licensed as an investment bank and broker dealer. With the recent proposed changes in the JOBS act, a lot more companies similar to ours yet focused on other industries will be popping up.
HOW ARE THE RETURNS ESTIMATED FOR EACH PROJECT?
Determining returns on investment are a very important part of our investment reviews. Our underwriters have more than 20 years of experience analyzing real estate investment prospects throughout the United States. Armed with extensive industry-wide experience, they meet the developers and property owners and conduct extensive scrutiny of the facts before coming up with the prospective return estimates.
HOW DOES THE INVESTMENT PROCESS WORK?
Your investment is not final until the project has met its Investment Target. Until then, the money is held securely in an independent escrow account at JP Morgan Chase. If the minimum is not met, JP Morgan Chase will return 100% of your investment directly to you. If the Investment is met, the money is transferred to an account controlled by our asset management team, which only releases it if the property owner or developer has met the guidelines set forth in the development plan.
IS THERE AN INVESTMENT MINIMUM AND MAXIMUM?
Yes. The minimum investment is different for each investment and is set by the Company, based in part on how much capital is being raised.
IS THERE A LIMIT TO THE NUMBER OF INVESTORS ON EACH PROJECT?
Yes, a limited number of investors are accepted into each project on iFunding. Historically, the Securities and Exchange Commission limited the number of investors for any non-registered security to 500 investors. With the JOBS Act, signed into law by President Obama on April 5th, 2012, the number of permitted shareholders will increase to 2,000. Of these, up to 500 can be unaccredited investors. However, private companies will not be able to allow unaccredited investors until after the SEC rulemaking period which ends in 2013.
WHAT HAPPENS IF A ROUND IS OVERSUBSCRIBED?
The round is first come first serve. One of the goals of iFunding is to build transparency and help to democratize early stage investing. If you liked the investment first, you should have a right to invest first!
HOW DO YOU DETERMINE WHETHER TENANTS ARE CREDITWORTHY?
We have a well-established and proven underwriting process to determine the creditworthiness of our potential tenants. The underwriting process includes analyzing the financial data and other information about the tenant that we may deem relevant.
WILL I BE NOTIFIED OF HOW MY INVESTMENT IS DOING?
Yes. We provide you with periodic updates on your investments, including access to a personal dashboard where you can monitor all your investments, their payouts and expected cashflows.
HOW DOES THE JOBS ACT AFFECT IFUNDING?
The JOBS Act, signed on 5th April 2012 by President Obama, establishes a new legal framework for private share offerings. Although it doesn't affect iFunding in the near future, it has opened a world of possibilities for the future. Right now we are busy focusing on providing excellent service to our clients that can do business in the market today. The issue-led offerings available on our platform are permitted through a prior exemption, namely Regulation D, Rule 506.
WHAT MARKETS DOES IF TARGET FOR REAL ESTATE INVESTMENTS?
Right now the NorthEast because of the asset management team is here and we want to keep costs down and the fees we charge to investors as low as possible. Also, the NorthEast is usually protected for the huge downturns in the RE market and has proven to be more stable than other markets like Phoenix, Las Vegas or Miami.
