This article is from the Australian Property Journal archive
AN equity raising has seen more than $900,000 raised via crowdfunding in just four hours, for a $13.4 million residential property development in Riverstone East, in Sydney’s north-west.
Property developer Clearstate raised the money for the development via crowdfunding platform VentureCrowd in four hours, which will give investors 49% equity in the project that will see the block of land subdivided for 35 new homes.
“We believe this is the first online platform-based equity raise for a residential subdivision in Australia,” VentureCrowd CEO Ron Nankivell said.
The groups said the ability of investors able to invest in the equity of a property development before it is subdivided and sold enabled higher potential returns on their investment in a shorter timeframe.
“Crowdfunding has raised an estimated US$2.5 billion for real estate globally and is only expected to grow substantially in the future,” Nankivell said.
“Though Australia is lagging behind the world when it comes to innovative funding mechanisms, the Riverstone East project proves that wholesale investors are not. Wholesale investors are ready and willing to invest and gain access to alternatives within the Australian property sector at an early stage on an aligned basis with the developer. We expect this to continue with a number of similar investment opportunities in the coming months,” he added.
VentureCrowd has previously raised more than $14 million in funding for start-ups and high growth companies.
“After undertaking property subdivisions across Sydney and Melbourne we looked at the Riverstone project as an opportunity to provide investors with an avenue to access projects and potential returns they otherwise couldn’t access on their own,” Clearstate commercial director Lachlan Cameron said.
Australian Property Journal
