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How are CrowdStreet investors handling their investments in the wake of COVID-19?

Email sent: Jun 4, 2020 10:25am
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Investor Roundtable With The Motley Fool

Watch The Live Stream On-Demand

On Thursday, May 28th, Matt Argersinger, Lead Advisor at Millionacres, the real estate arm of The Motley Fool, and Ian Formigle, Chief Investment Officer at CrowdStreet, co-hosted a live investor roundtable with three investors–John Keeling, Vipanj Patel, and Norm Witt–as they discussed their personal investing strategies given the current state of the economy.

 

As John points out, there are a lot of red flags in the short term, but his best investments have come out of periods of uncertainty. Vipanj agreed, adding that “times of dislocation are what create the greatest opportunities.” Norm said he’s cautiously optimistic and is watching to see how different sectors and asset classes– such as grocery-anchored retail–perform in the coming months.

Product Updates: A New Offering Experience for High-Demand Deals

When there is extremely high demand for a deal, it creates a heavy load on our platform. In order to prevent submission issues, we’ve launched several updates to the offer submission process.

 

The Investment Countdown Timer 

There is now a clock on the deal detail page that counts down to the exact moment that offers will be accepted. When the timer hits zero, the “Invest Now” button will appear, all without a browser refresh. Open the deal’s detail page at any point after the live webinar begins and before the investing period opens and you’ll see the countdown timer.

 

The Submission Queue

For deals experiencing extremely high demand, we’ll turn on our new queueing feature. This allows a set number of investors to progress to the next step in the submission process, with each investor’s position displayed and updated every few seconds. Once you’ve reached the top of the queue, you will automatically proceed to the next step where you can complete your offer.

 

Funding Instructions

Offers will be pre-approved shortly after the webinar ends and once your offer is pre-approved, you’ll receive an email inviting you to complete your documents. You will gain access to the funding instructions after you complete your documents, rather than the order in which you clicked the “Invest Now” button. Investors who complete their documents soonest will be invited to send funds to complete their investments, while investors with incomplete documents will be waitlisted once the offering is fully allocated. As always, investments will be finalized on a first-to-fund basis.

 

Do not refresh your browser at any point prior to or while submitting your offer.

 

One of the things that distinguish legendary investors is that, when these times occur, they don’t just play defense...They use it as an opportunity to move forward.”

- Dr. Peter Linneman, Professor Emeritus at the Wharton School of Business, Principal of Linneman Associates, and world-renowned real estate industry economist

Three Predictions For The Post-Pandemic Office

With millions of U.S workers now operating remotely, the office has moved from open floor plans in downtown highrises to kitchen tables and basement corners. And for the most part, it’s working. It’s perhaps not too surprising that tech giants like Twitter, Facebook, and Box have said their employees can work remotely for the rest of the year–if not forever–but even financial institutions like Morgan Stanley are saying they’ll keep some percentage of their staff remote, even after things open back up. So what does that mean for the office?

 

In his latest article for Forbes, Chief Investment Officer Ian Formigle hypothesizes what the office could look like in a post-COVID world.

How COVID-19 is Impacting Real Estate’s Durability of Income

Income matters because it’s what allows real estate owners to pay their debts, and, hopefully, send distributions to investors. However, while generally all occupied commercial real estate assets produce some amount of income, the durability of a property’s income stream can vary greatly.  As our Investment Products & Portfolio Manager, Thomas McDonald, puts it, “Not all income is created equally.” 

 

Whether an investment generates income in the coming months depends heavily on how essential the businesses occupying that property are to our daily lives, and how well those businesses can handle an extended economic downturn and the slow, staggered re-opening of our economy.

Finding Opportunities Amidst Uncertainty

Just as black swan events bring distress into markets, they can also present opportunities for investors. Real Capital Analytics reported that valuations fell by 35% between August 2008 and June 2010, providing investors with an appetite for risk the opportunity to buy distressed properties at a steep discount. 


“An opportunist buys things because they’re offered at bargain prices,” says Oaktree Capital Management’s Howard Marks in The Most Important Thing. If the current market repeats 2008 pricing, many commercial real estate assets could decrease in value, creating an opportunity for sponsors (and their investors) to acquire those assets at attractive prices and with low-interest rates. In fact, The Wall Street Journal is calling the current market environment a “Potential Bonanza in Distressed Sales.”

 

Active Offerings

 
 

Renaissance Baltimore Harborplace

The distressed acquisition of a 622-room, full-service, Renaissance hotel located in the Inner Harbor of Baltimore, Maryland.

 

View the details.

 

Mezzanine Fund V

$475 million fund from an Enterprise-level sponsor targeting a diversified portfolio of high yield debt and preferred equity investments including; acquisition loans, construction financing, and financing for partner buy-outs and special distributions

 

View the details.

 

Sonata at Columbia Station

Class-A multifamily in downtown Seattle, a Top 10 ULI market, with attractive basis and favorable loan terms.

 

View the details.

 

The Clark Building

A 91.4% occupied, 205,200 net-rentable SF, Class B, multi-tenant office building located in the Westown submarket in Milwaukee, WI.

 

View the details

CrowdStreet
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Portland  OR   97205   United States
info@crowdstreet.com
888.432.7693 | crowdstreet.com
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This communication is intended only for the recipient to whom it is addressed and may contain information that is privileged and confidential.  If you have received this in error, please immediately notify the sender and permanently delete the original and any printout thereof.  

 

This communication is for informational purposes only and should not be regarded as a recommendation, an offer to sell securities, or a solicitation of an offer to buy any investment products, financial products, or services. Any information contained herein is believed by CrowdStreet, Inc. (“CrowdStreet”) to be reliable, but we make no representations or warranties as to the accuracy of such information and accept no liability therefor. No part of this email (or its attachments) is intended to be binding on CrowdStreet or to supersede any issuer offering materials.  CrowdStreet is not a registered broker-dealer or investment adviser. We recommend that you consult with a financial advisor, attorney, accountant, and any other professional that can help you to understand and assess the risks associated with any investment opportunity.

 

Information in this communication, including information regarding targeted returns and investment performance, is provided by the sponsor of the investment opportunity and is subject to change. Forward-looking statements, hypothetical information or calculations, financial estimates and targeted returns are inherently uncertain. Such information should not be used as a primary basis for an investor’s decision to invest. Investment opportunities on the CrowdStreet Marketplace are speculative and involve substantial risk. You should not invest unless you can sustain the risk of loss of capital, including the risk of total loss of capital.  

 

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