As Whole Foods plans to open a 5-acre project in Englewood Square, Chicago, it has already peaked the interest of the local residents. This is because out of the $15 million allocated for the project, $500,000 was contributed by the general public through crowdfunding. The participants were 61 investors from 21 different states and the money was crowdfunded within two days.
The crowdfunding was led by Fundrise, an investment platform for commercial real estate, in partnership with DL3 Realty, a commercial real estate company. The rapid success of the campaign came as a surprise considering that it happened before the recent approval of crowdfunding regulations, which allow both accredited and non-accredited individuals to participate in crowdfunding investments. This is the first investment project for Fundrise in Chicago. The crowdfunding platform approached Whole Foods executives two years ago and proposed opening a store in one of Chicago’s communities facing hard economic times. Ben Miller, co-founder & CEO of Fundrise, said that this is one of the more remarkable deals which has the capability of transforming the neighborhood. The project will also include Starbucks, a healthcare clinic and a bank.
Leo Walker, managing partner of DL3, stated that they plan to complete construction of the project next spring, and, following that, Whole Foods will open during fall of 2016. He added that the project has once again demonstrated the power of the crowd. It also shows the increasing awareness of crowdfunding among the citizens. The project is approximated to give annual returns of 10 percent on the 2-year investment.
According to Miller, the new crowdfunding rules will make it easier for people to invest in projects with high risks and high rewards. He added that they will also bring in a new era of tech-based investing where people can invest in projects located in any part of the country or world via the internet.
DL3 are also considering half a dozen commercial real estate investment deals in Chicago, which are likely to transform various communities in the region. Crowdfunding is a mechanism they will use to as a means of funding these projects.