Backed by mostly small investors, real estate startup Fundrise is developing a sizable portfolio of commercial properties in a section of Los Angeles.
The company has scooped up mostly small low-rise commercial buildings along on West Jefferson Boulevard, overhauling them into small offices and retail shops to complement them, according to Bloomberg News.
The smaller office spaces could appeal to companies looking to downsize post-pandemic and to small firms with no need for large spaces.
Fundrise started buying on the commercial strip in 2017 and now owns around two dozen properties between Crenshaw Boulevard and Potomac Avenue.
Its first tenant was rapper Nas’ music and production company Mass Appeal, which is leasing a 5,000-square-foot converted storage and office building.
Since then it has signed leases with Party Beer Company, Lorcan O’Herlihy Architects, Reparations Club and a handful of other tenants.
The firm’s latest acquisition was a vacant 7,000-square-foot parcel on the corner of Hillcrest Drive. The $3.1 million buy completed Fundrise’s acquisition of the entire block, which is otherwise aging, low-rise commercial buildings.
Fundrise is also working on at least one residential project in the area. The firm last year filed plans for an 81-unit project on nearby Crenshaw Boulevard.
Unlike most private equity firms, Fundrise has low minimum investment requirements — as little as $500 — and targets small investors. As of June, the company had about 150,000 backers.
It’s also attracted attention from institutional firms. In June, Goldman Sachs extended a $300 million credit facility to the firm to finance its $500 million bet on single-family rentals.
[Bloomberg] — Dennis Lynch