CrowdStreet REIT I (C-REIT)

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The C-REIT is CrowdStreet's first private REIT, which allows accredited investors to gain access to a portfolio of institutional-quality investments managed by CrowdStreet Advisors. Crowdstreet’s management team handpicks the properties in the C-REIT portfolio with a focus on growth.

The properties included in the REIT are a diverse mix of commercial assets spread across a variety of sectors to minimize risk and maximize growth potential. The asset sectors include, but are not limited to, the following:
  • Industrial
  • Healthcare
  • Multi-family
  • Build-to-rent
Shareholders in the C-REIT will become equity owners of the assets in the portfolio and receive the tax benefits that come with property ownership (e.g., depreciation write-offs). The C-REIT will pay out dividends on a quarterly basis and targets a 15% internal rate of return with an equity multiple between 1.8-2.3x.

Investor Requirements and Other Details​


Crowdstreet’s C-REIT has a $1,000 per share offering price and carries a minimum initial investment of $25,000. The C-REIT is only available to accredited investors inside the United States. It is also open to self-directed IRAs. The C-REIT’s holding period is slated to be between 5-7 years and investors will receive a 1099-Div tax filing annually. The management fee is 1.5.% annually.
 
Benzinga's Take
REITs are one of the simplest ways for the average investor to gain access to institutional-quality real estate, without having to commit huge sums of capital or take on the responsibility of managing the assets.
However, most REITs that are available to invest in are publicly-traded. While this does come with the benefits of easy access, low minimum investments and liquidity, it does make them vulnerable to stock market volatility like any other publicly traded stock.
Private REITs, such as the C-REIT, aren't traded on a public stock exchange. This means the value of an investor's shares in the REIT are directly tied to the value of the equity in the assets. The share price does not fluctuate with the market.
While many investors view the lack of liquidity that comes along with investments like private REITs as a negative, the truth is that this illiquidity can serve to protect the long-term value of a portfolio.
Of course, not every private REIT is going to be a good investment. One of the most important aspects to consider is the strength of the management team operating the REIT. In the case of the C-REIT, the management has a long track record of success, access to deal flow and the data and research to make informed investment decisions.
It's also easy to argue that REITs are best suited to have a limited shelf-life. Since REITs are required to pay out at least 90% of their taxable income to shareholders, growth becomes difficult without taking on new debt or diluting equity by issuing more shares. Publicly traded REITs need to grow constantly in an effort to continue attracting new investors, or the share price will fall. Private REITs, on the other hand, typically have an end game. The focus can remain on increasing the value of the portfolio and generating a strong return for investors over the course of 5-10 years.
While the 15% target IRR of the C-REIT is no guarantee of the actual returns, those numbers are based on realistic projections and assumptions that take current economic conditions into account, so assuming a 15% annualized return is as safe of a bet as anything. Considering the current uncertainty in the stock market, I would say investing in the C-REIT is one of the smarter moves an investor could make right now.
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Minimum Investment
$25000

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