Crowdfunding Platform RealtyReturns Targets Hawaii Real Estate market
San Francisco-based RealtyReturns wants to become the first crowdfunding platform involved with the Hawaii market and make it easier for anyone to invest in real estate.
The Title III real estate crowdfunding platform is one of the seven startups in Honolulu-based Blue Startups’ latest cohort and Rexford Hibbs, CEO and co-founder, told Pacific Business News the startup’s goal is to “democratize" investing in real estate.”
“Real estate kind of has this stigma — kind of like the "Monopoly" man, if you will — the rich guy with a suit and a cane, top hat and a monocle,” he said. “The super rich guy. I don’t really see real estate in that way. I think that everyone should be able to participate. That was the catalyst for RealtyReturns.”
The platform operates through two models; debt investments and equity investments.
“The debt investments is essentially peer-to-peer lending,” he said. Hibbs said the platform provides loans for people flipping houses.
“Investors get paid back monthly with set interest rates over the course of 12 months,” he added. “Investors can receive rent checks in the mail each month and then at the end you get your lump sum back. It's more of a short term lending investment.”
The equity side of the platform allows for physical ownership. “If you wanted to own a piece of a condo in Waikiki, you could do that for as little as a thousand dollars,” he said. “You could co-invest with sometimes upwards of a couple 100 people. Then you’d own a percentage of that.”
Hibbs said it would be an income generating property, with tenants staying in the property itself paying rent. “It would be like owning a percentage of a hotel room, essentially,” he added.
“We’re giving power back to the little guys,” said Kian Khoo, the startup's marketing director. “Real estate has always been a big boys’ club. [RealtyReturns] lets you get in the door. We felt that Hawaii was a good fit for that. There’s a bustling real estate market.”
Khoo says the platform would also support local Hawaii businesses.
“One of the ideas we thought about was, for example, if shop unit is up for sale, but the shop itself isn’t able to pay the amount,” Khoo said. “You can get customers to actually contribute together and own part of that store. It reinforces the community.”
Hibbs said the startup is looking to target everything from houses, shopping malls to apartment complexes and condos.
“Why does one person have to own it when 200-plus people can own the same property and still get the same benefits that that one person was able to."