Currently, only accredited investors can invest with PeerRealty. An accredited investor is a term defined by the U.S. Securities and Exchange Commission (SEC) under Regulation D, Rule 501. An investor must accomplish at least one of the following in order to qualify as accredited:

1. Earn an individual income of more than $200,000 per year, or a joint spousal income of more than $300,000 per year, in each of the last two years and expect to reasonably maintain the same level of income.
2. Have a net worth exceeding $1 million, either individually or jointly with his or her spouse.
3. Be a bank, insurance company, registered investment company, business development company, or small business investment company.
4. Be a general partner, executive officer, director or a related combination thereof for the issuer of a security being offered.
5. Be a business in which all the equity owners are accredited investors.
6. Be an employee benefit plan, a trust, charitable organization, partnership, or company with total assets in excess of $5 million.

Investors can verify their accreditation status by following the steps spelled out in the Investor Dashboard. Simply create an account or sign in and select “Dashboard” on the top right hand corner of your screen. This should bring you to the “My Dashboard” section. Click on “Update your Investment Account,” and scroll down to “2) Accreditation Process.” Click on “Verify Accreditation” and begin the investor verification process from there.

There are many methods to qualify as an accredited investor, including providing supporting documentation of your assets or income, providing a letter from a licensed professional certifying your status as an accredited investor, or allowing third-party vendors to verify your status as an accredited investor. In some instances, a detailed bio stating your source of wealth, employment history, and income may also suffice.

For trusts, LLCs and other entities, we are required to collect the relevant legal agreements to ensure you are legally permitted to direct investments.

For additional information about individual and entity accreditation requirements, please review the guidelines on the SEC website or email us at info@peerrealty.com.

Unfortunately, due to existing regulations, PeerRealty offerings are currently only open to accredited investors. With Reg. A+ set to go into effect in June 2015, a pending Illinois intrastate crowdfunding bill, and Title III of the JOBS Act due to be implemented at some point in 2015, we’re hopeful that we will have opportunities for non-accredited investors in the future. Non-accredited investors can create an account and review the offerings, and we encourage you to do so even if you aren’t an accredited investor.

Joining PeerRealty and browsing the marketplace is free. PeerRealty charges real estate companies a one-time origination fee. The detailed breakdown of fees to investors are disclosed on the individual page for each investment opportunity.

Yes, assuming that all other 1031 exchange requirements are met. In particular, a taxpayer seeking to do a 1031 exchange is not allowed to have access to or control over the funds while an exchange is in process, so the taxpayer should identify a qualified intermediary to handle the funds during this process. Consult a tax professional for more information.

When investing in a REIT, most investors have little to no information regarding actual properties the REIT invests in and cannot select their own investments. With PeerRealty, investors can invest in individual properties, giving added transparency and control over the investment process. In addition, REITs are such large entities that they can rarely participate in many of the mid-market investments PeerRealty will be including in the marketplace such as retail centers and multi-family buildings.

PeerRealty generally acts as an intermediary between investors and the sponsor, and we’ll be happy to approach the sponsor with any questions investors might have. In certain instances, though, we will make direct introductions to the sponsor.

The sponsor controls the assets and is responsible to managing the subject property or properties. PeerRealty performs careful due diligence on each sponsor to ensure that they have experience managing similar assets.

No. We make it clear to sponsors when we begin discussions with them that PeerRealty will not be making any additional capital contributions to the project after our initial investment. We carefully review the operating agreement and the terms of each deal to ensure that investors will not be expected to contribute to any capital calls that may arise. In worst-case-scenarios, though, it is possible that investors will be diluted if more money is needed.

The investment period varies widely depending on the type of investment. Equity investments can range from 3-10 years. Please review the expected hold period for each investment before making an investment.

All investors have access to a PeerRealty investor dashboard. Through the dashboard, investors can track how much has been invested, which transactions are active, and how much investors have earned on the investment to date. In addition, PeerRealty provides quarterly updates via both the investor dashboard and email.

A preferred return is a return paid to investors before a sponsor receives any share of the cash flow. The preferred return can be paid out on a monthly, quarterly, or yearly basis depending on the specific terms of a deal.

Minimums are typically $5,000 per investment. In some cases, the minimum may be different. Minimums will be clearly disclosed on the individual offering page.

PeerRealty will receive the payments either directly from the sponsor or from a third party servicing company and will remit such payments directly to investors through our online system, net of any applicable servicing or processing fees. Projected returns and distributions, as well as a timetable for milestones and a distribution schedule, are specific to each listing and will be noted in the offering documents for that investment.

While PeerRealty performs as much due diligence as possible, there are no guarantees when investing in real estate and these investments are risky. The real estate market has economic cycles, and it is not easy to predict how and when economic conditions will change. The investments can be highly speculative and investors should be able to bear the loss of their entire investment.

We highly encourage investors to review the due diligence materials provided for each deal as well as the accompanying legal documentation, which includes an investor agreement and a private placement memorandum detailing risks of the company and the accompanying real estate project.

PeerRealty uses a bankruptcy remote structure to safeguard our investor assets as much as possible. If PeerRealty goes out of business, a secondary service provider will be appointed to service any outstanding projects from the platform. The project investments are made through special purpose entities which are restricted from taking on any form of debt not related to the corresponding projects.

While PeerRealty provides investors with relevant information including market data, sponsor information, property information and third party information, PeerRealty makes no recommendations about any particular investment and each investor must do their own due diligence before making a decision to invest.

Before placing any investment opportunity on our platform, PeerRealty reviews each aspect of the proposed transaction, including financials, geography, property type and quality, and investment structure. We also perform background and credit checks on each sponsor. While each investment includes risk and PeerRealty cannot guarantee results, our vetting process seeks to ensure that only quality investment properties are listed on the platform. Once an investment opportunity is listed on the platform, investors have full discretion as to whether to personally invest in the opportunity, and if so, how much.

Investors can invest in pre-vetted real estate investments online through a simple and secure website by creating an account, verifying their accreditation status, selecting an investment that is suitable, signing legal documents and funding the investment. When an investment is made, the money is held in escrow until the deal closes. Once the investment target is met, the money is transferred to the project company for the sole purpose of the specific property being invested in.

Real estate companies work with PeerRealty because of the benefits that crowdfunding can offer. Crowdfunding offers a faster, more flexible, lower fee source of capital than traditional lenders, valuable branding and networking, and financing for varying types of deals and properties.

PeerRealty focuses on equity raises ranging from $1 million to $5 million.

While our current geographic focus is on the Midwest, we are actively pursuing projects throughout the United States. We do not accept projects from outside of the United States at this time.

Yes. PeerRealty requires background, criminal and credit checks as part of our due diligence process.

PeerRealty invests as a single limited member into a sponsor’s Limited Liability Company (“LLC”) or Limited Partnership (“LP”). All PeerRealty investors are pooled into a special purpose vehicle, typically an LLC, and then PeerRealty subscribes to the sponsor’s entity as a single investor. This means the sponsor is only responsible for one report, one distribution and one K-1. PeerRealty processes all of the underlying reports, distributions and K-1s for our investors.

No. PeerRealty is the issuer.

No, all investors are pooled into the special purpose vehicle, and all sponsor reporting requirements are for the one LLC.

Most transactions are funded within 15-30 days of going live on the PeerRealty platform. Due diligence and sponsor onboarding typically takes 2-4 weeks, but can be shortened if all materials are received quickly.

Possibly, under certain circumstances. Contact us for more information.

Potential developer partners can now get started by building their own profiles on PeerRealty. The best way for us to evaluate potential sponsors is by gathering the information in this profile. We will review them in the order in which they’re submitted, so completing your profile is the fastest way to move forward.

Yes. PeerRealty requires background, criminal and credit checks as part of our due diligence process.

We look for high-quality, experienced developers with an established track record. Check out our sponsor page for more information on the types of deals that we target.

Once we review the initial submission from our website, we will contact you to discuss the project in more detail and explain the next steps if we feel the project is a good fit. Due to the volume of submissions we have been receiving, the more information you give us when submitting your project, the better your chances are of being contacting by PeerRealty.

PeerRealty does offer a white-label solution to select partners. Contact us at info@peerrealty.com for more information.