Wall Street Journal: Now You Can Build Your Own Real-Estate Empire, $100 at a Time
According to The Wall Street Journal,
A financial-technology startup is taking on the difficult task of enticing mom-and-pop investors to invest in small slices of office towers and other commercial buildings.
Lex Markets aims to serve as the intermediary between investors and real-estate firms looking to sell stakes in individual properties, arranging securities sales in increments of $100 and listing the offerings on its platform.
Efforts to sell alternatives to retail investments typically target wealthy individuals, so-called accredited investors, whom regulators believe are better able to handle losses and less-liquid investments. The drawback is that such offerings often charge high fees that limit returns, said Dave Bragg, managing director at Green Street Advisors, a real-estate research firm.
Lex plans to issue securities that nonaccredited investors could buy under the Jumpstart Our Business Startups Act of 2012. The act’s Reg A+ provision lowered the accounting and disclosure standards for certain public offerings, allowing investors with less than $1 million in net worth to buy them. Under the provision, issuers can raise as much as $50 million.
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