No matter what kind of outreach efforts real estate developers make in cities, there’s always been a gulf between residents of a city and the people who build the apartments. But Fundrise, a new startup is trying to close the gulf between the everyman and developers by allowing people to crowdfund real estate projects. If we all become real estate investors, will we stop being angry at developers?
A big part of the enmity between developers and people who live in a neighborhood has to do with the fact that while developers want to make a profit however they can, residents want to keep their neighborhoods from becoming cookie cutter bullshit. The Times talked to the people behind Fundrise, which started in DC, about their efforts to foster more community investment in the actual physical buildings that pop up.
Daniel and Benjamin Miller, DC residents, started Fundrise to give locals more of a say in what gets built in their communities, as opposed to developers who may live far from where the project actually goes up and therefore don’t care if a project doesn’t fit there. So they offer people the chance to buy shares in a development, which they can make money from, and also have a direct impact on the kinds of projects that get built in their backyard. It’s worked on a small scale so far, with three projects in DC getting full funding.
While Fundrise has thus far been limited to Washington, DC, it’s expanding out to Brooklyn soon, for a project in DUMBO. Working with 3rd Ward and real estate company Urban Muse, they hope to raise money for a retail and residential development on a lot near Brooklyn Bridge Park. It’s definitely an intriguing idea, but the Times article points out that it works more for smaller projects that cap out at a million dollars, since larger developments get into the tens of millions of dollars, and that’s incredibly difficult to crowdsource at the moment. Unless of course you’re shameless jerk Zach Braff.
Anyway, what do you think. Given the opportunity, would you put money down to make sure developments kept a local flavor to them, or are we all powerless in the face of the real estate machine until the housing bubble bursts?