The Toronto shopping mall will be one of the first real estate projects in Canada to be funded partially through crowdfunding. The project has been listed on NexusCrowd Inc. and was opened on September 9 to accredited investors willing to invest a minimum of US$7,520 (C$10,000) for an equity stake in the project. This is the first online platform to partner with institutions in Canada to raise money through crowdfunding for a real estate development project.
The first online platform to partner with institutions in Canada to raise money through crowdfunding
The growth of real estate crowdfunding has been remarkable especially in the US, and it is now rapidly growing in other parts of the world. NexusCrowd has opened its doors at a time when demand for real estate investment projects is very high. According to research firm Massolution, global real estate crowdfunding is expected to exceed $2.57 billion this year from over $1 billion in 2014 and $396.4 million in 2013.
Real estate investments are gradually being accessed by Canadians following the approval of crowdfunding for startups by the financial-services regulators last May. This approval was made in six provinces in Canada.
NexusCrowd targets ventures that have already received at least 50 percent of the funding from a partner and only accredited investors are allowed to participate. The platform aims to crowdfund a minimum of C$500,000 for each venture with expected annual returns between 15 and 20 percent.
The shopping mall in Mississauga, Toronto, is a two-story 23,000 m2 building. It will be anchored by Galleria Supermarket which has a 50 percent stake in the property, with TerraCap Management owning the remaining interest. Through its partnership with TerraCap, NexusCrowd targets to raise C$500,000 through crowdfunding. The project is expected to be ready by December 2017.
Note: First published in timesrealtynews.com with this link: http://timesrealtynews.com/real-estate-crowdfunding-reaches-canada-with-toronto-shopping-mall/