EquityMultiple Review 2024

EquityMultiple uses crowdfunding to offer accredited investors an opportunity to invest in a pool of properties (like a REIT), individual commercial properties, or real estate notes.

I think this real estate crowdfunding platform is great for:

• Investors who want a single real estate investment platform for multiple investments
• Those seeking diversification
• Flexibility of investment
• Low cost-of-entry for higher-yielding investments

EquityMultiple At A Glance

External EquityMultiple Reviews & Ratings

Firsthand User Experience with EquityMultiple

After digging through countless reviews online, here are some of the most telling reviews I came across, from traders who have experienced the platform firsthand:

EquityMultiple Customer Review Analysis

Most of the negative reviews that I was able to find online stemmed from 2 main complaints: Tardiness in delivering K-1 tax forms and investors that have lost money. Let me discuss these complaints in a little detail.

If an investor is unable to file their taxes on time because EquityMultiple did not produce the necessary tax documents in time, this is a major problem and inconvenience for investors. As we know, there are 2 sides to every story. It is very possible that these investors did not request this specific information in time, so they did not receive it in time.

As for investors complaining about losing all of their money on the platform, there are a point I would like to make. EquityMultiple is only available to accredited investors for a reason. These investment vehicles on EquityMultiple are higher risk and offer a higher reward.

With all gains and losses considered, EquityMultiple has delivered market-beating returns. The return on all types of investments on their platform has been an impressive 17.4%. Opinions aside, the numbers speak for themselves, the upside for investors with EquityMultiple is undeniable.

As far as EquityMultiple Reddit reviews, it’s a mixed bag. From what I’ve read the EquityMultiple Reddit reviews pretty much mirror the reviews on other platforms and app stores.

What Is EquityMultiple?

EquityMultiple, based in New York, has established itself as a prominent player in the real estate crowdfunding arena. It was co-founded by Charles Clinton, a real estate lawyer with a keen understanding of the market’s legal landscape, and Marious Sjulsen, who have over 30 years in CRE investments for both institutional investment firms and private investment consultants. Their combined expertise and vision led to the creation of a platform designed to democratize access to commercial real estate investments.

The platform distinguishes itself through a commitment to technology, using it to efficiently connect investors with a range of real estate projects and reputable investment sponsors. This approach has positioned EquityMultiple as a secure and neutral marketplace, aiming to facilitate beneficial transactions for all involved parties. Unlike other crowdfunding real estate companies, EquityMultiple boasts significant support from Mission Capital Advisors, enhancing its credibility and reach.

EquityMultiple’s offerings are designed for investors meeting certain capital or net worth thresholds, providing them with a choice among debt, preferred equity, or common equity structures. The investments span across a pool of commercial properties, co-investment in individual properties, or short-term notes secured by real property. With a lower entry point of around $10,000, it makes professionally-managed commercial real estate more accessible.

The platform is known for its transparency about fees and costs and its rigorous due diligence process. Before any project appears on the platform, it undergoes several layers of vetting, ensuring that only high-quality investment opportunities are presented. This meticulous approach adds a significant layer of protection and confidence for investors.

EquityMultiple’s mission, spearheaded by Clinton and Sjulsen, is to provide a broader range of commercial real estate investment opportunities compared to traditional REITs. It aims to serve as a “one-stop shop” for investors looking to diversify their portfolios with multiple pools or varied individual properties. The platform’s history and evolution reflect a continuous effort to level the playing field for individual investors, making the complex world of commercial real estate investments more accessible and transparent.

Click for EquityMultiple pricing and details.

A Unique Advantage

One of the things that give EquityMultiple a unique advantage over competing services is its backer, Mission Capital. Several of this national real estate capital markets firm’s senior executives have personally invested in the company, meaning they have skin in the game. Knowing that ownership has their own finances behind EquityMultiple, gives me more confidence that they will do everything in their power to guarantee success.

Mission Capital itself provides investing insights, strategies, and leads to EquityMultiple via its diverse network of lenders, investors, and sponsors. This enables the company to expand faster than it would be able to on its own.

Who is EquityMultiple for?

EquityMultiple is tailored for accredited investors seeking alternative investment opportunities in real estate. It’s particularly geared towards those with a substantial track record in the industry, though it also accommodates those interested in short-term debt investment options. As an exclusive platform, it serves accredited investors with a variety of investment choices, each tied to underlying assets such as debt deals, preferred equity, common equity investments, and senior debt deals. These options come with their own minimum deposit requirements and expected returns, allowing investors to choose how to allocate their capital.

What distinguishes EquityMultiple is its commitment to offering a diverse range of alternative investment opportunities. These options provide long-term investors a robust way to diversify their portfolio, with real estate as the underlying asset known for its potential for significant returns. The platform ensures a layer of protection for its users by rigorously vetting each deal for legitimacy and promise, reflecting its commitment to investor security and high-quality offerings.

Transparency is paramount at EquityMultiple. Investors are fully informed about the fees associated with each investment, with all costs explicitly listed alongside the deals. This transparency extends to showing the precise impact of fees on overall returns, allowing investors to make informed financial decisions without the need for additional calculations.

For those accredited investors seeking a sophisticated platform that combines a solid track record, diverse alternative investment options, a layer of protection through rigorous vetting, and transparency in costs, EquityMultiple stands out as an attractive choice.

EquityMultiple Investment Options

EquityMultiple presents three primary investment avenues: Fund Investing, Direct Investing, and Savings Alternative, each offering distinct strategies for engaging with commercial real estate.

Fund Investing operates similarly to a traditional Real Estate Investment Trust (REIT), amalgamating multiple assets within a fund to provide built-in diversity. This option encompasses strategies like Debt, Equity, Opportunity Funds, and Commercial Real Estate (CRE) Securities, each offering varying degrees of risk and return.

Direct Investing is a more individualized approach, allowing fractional investment in single commercial properties. Once enough investors pool their resources, the investment is initiated, with each offering providing unique projected returns and exit strategies.

The Savings Alternative, or investing in notes, involves pooling capital to fund short-term notes secured by real estate assets. These notes typically generate passive interest income for investors, functioning as a more secure investment vehicle compared to more volatile options.

EquityMultiple does not offer typical REITs but focuses instead on “senior debt” investments in commercial real estate, providing three distinct types: Syndicated Debt, Preferred Equity, and Equity.

Syndicated Debt investments are backed by companies with extensive real estate experience, providing an additional layer of security for investors. These are short-term, typically lasting between six months and two years, and are designed to bring confidence and security, especially to those new to real estate investing.

Preferred Equity deals align more closely with the crowdfunding aspect of the platform. Funded entirely by individual investors, these deals tend to be riskier but offer higher returns, generally between 10 and 14%. Investors in these deals receive cash flow distribution preference after debts are settled. These investments usually span one to three years.

Equity investments are the riskiest category offered by EquityMultiple, where investors are the last to be reimbursed. These long-term investments span three to seven years and promise the highest potential returns, sometimes up to 20%. Despite the risk, the substantial reward potential makes them an attractive option for certain investors.

Investor Protection

Despite a few negative reviews I read online, EquityMultiple is very upfront about the fact that the real estate investment market isn’t a sure thing. They make sure that all investors are aware they may lose money with their investment offerings and place great importance on staying within one’s own risk tolerance.

Nonetheless, EquityMultiple also does its best to provide adequate protection for investors across various types of deals. It does this through a combination of company-backed investments, protective business structuring, and contracts.

For short-term notes specifically, EquityMultiple personally backs your investment(s). If things turn sour and your investment falls through, the company uses its own real-estate holdings to offer First-Loss Protection. These diversified notes are the company’s most liquid offering, redeemable after 3, 6, or 9 months. You won’t be charged any fees; you’ll only be required to deposit a minimum of $5,000. The note(s) will generate interest throughout the term length.

For all investments, EquityMultiple creates a deal-specific LLC. Investing in a deal turns you into a partial owner of the LLC, which entitles you to both the gains and losses of that particular deal. By incorporating a Limited Liability Company into the investment process, EquityMultiple is able to shield investors from any financial issues that may arise.

EquityMultiple Pricing

EquityMultiple operates as an investment intermediary, earning revenue primarily through various service fees, which vary according to the type of investment deal. There isn’t a uniform fee for all investors; instead, fees differ based on the specific investment structure.

For equity deals, EquityMultiple charges a 2% flat placement fee for sponsors and an annual fee of 0.5-1% for investors. In preferred equity deals, the fees include the same 2% flat placement fee for sponsors and a 1% spread off the total preferred return, which is paid monthly by investors. For debt deals, the structure is similar with a 2% flat placement fee for sponsors and a 1% spread off the interest rate, also paid monthly by investors.

Regarding investment minimums, EquityMultiple requires a minimum investment of $5,000 for notes, referred to as “Saving Alternative,” $10,000 for Direct Investment, and $20,000 for Fund Investment. These thresholds provide options for different levels of investment commitment based on individual financial capabilities and investment strategies.

EquityMultiple Portfolios

EquityMultiple’s website provides a listing of both previous investments and current real estate deals. Some past offerings include luxury condos in Brooklyn, Class-A multifamily in Houston, and even campsites and storage facilities.

Access to current offerings is available by signing up on EquityMultiple’s website.

EquityMultiple Performance

EquityMultiple has a historic annual rate of return of 17.4%. This return is an average across all its offerings – Funds, Direct, and Savings Alternative (notes).

• EquityMultiple has invested over $427 million so far
• They estimate their total project value to exceed $4.22 billion
• EquityMultiple calculates its current weighted average net internal rate of return at 18.7% across all realized investments
• Annual returns for investors have increased every year since the company was founded, providing an excellent real estate experience for investors
• Gross distributions exceed $240.3 million (as of 2022)

How to Join EquityMultiple

Potential investors interested in taking advantage of the wide variety of investment options on EquityMultiple will need to register for the website. Let me walk you through this straightforward process. To begin, the website will ask for your email address.

From here, you’ll need to choose a password and then provide some basic information (first name, last name, residence status, and how you heard about the service). Once this has been completed, you’ll be required to verify your email address before moving on to the next step.

After you’ve verified your email, it’s time to verify your status as an accredited investor. Assuming you meet the annual income, net worth, or other qualifiers, you’ll have to provide a bit of additional information before you’ll be able to start viewing real estate projects and opportunities.

There are many different project types, debt deals, and individual investments for you to consider on EquityMultiple. Before committing to and funding any type of investment, you’ll want to closely review the terms of the contract.

Fortunately, EquityMultiple provides debt investors with all the relevant details about the offering, including investment property information, the potential return rate, investment objectives, and any applicable fees for investors.

EquityMultiple’s Strengths

Here are EquityMultiple’s main strengths I think you should be aware of:

• Specialized Investments: EquityMultiple offers a range of options including preferred equity, common equity, funds, 1031 exchanges, and senior debt through investment products like The Alpine Note, the Ascent Income Fund, and the Brooklyn Industrial NPL Acquisition, each with unique terms and benefits.
• High Returns: Targets relatively high rates of return depending on the investment type, including 8-12% for senior debt, 10-14% for preferred equity, and over 18% net IRRs for opportunistic equity.
• Diverse Investment Products: Features varied investment durations and minimums, like the nine-month Alpine Note and the more substantial Ascent Income Fund, catering to different investor needs and time frames.
• Regular Distributions: Typically provides investors with monthly or quarterly distributions from debt and preferred equity investments, though specific timelines and amounts can vary by deal.
• User-Friendly Platform: Allows accredited investors to easily create an account, review investments, and link funding sources without the need for initial deposits or cumbersome proof of accreditation.
• Co-investment Strategy: Claims to co-invest in every deal, aligning its interests with those of the investors and adding a layer of commitment and confidence.
• Rigorous Due Diligence: Emphasizes thorough vetting of all deals, ensuring each investment opportunity is scrutinized for quality and potential.
• Transparency in Fees: Clearly communicates the costs associated with each investment, providing investors with detailed information about how fees affect their returns.
• Liquidity Consideration: Acknowledges the illiquid nature of many investments, advising investors to consider their need for short-term liquidity when choosing an investment.

Equity Multiple Weaknesses

While EquityMultiple offers many benefits, there are certain limitations and challenges potential investors should be aware of:

• Accreditation Requirement: EquityMultiple is exclusive to accredited investors. This means individuals must meet specific net worth or income criteria to invest, potentially limiting access for the average investor.
• Variable Investment Performance: While many investments perform well, there are occasions where selections may underperform, reflecting the inherent risks associated with active investment.
• Complex Fee Structure: Each investment on the platform has its own unique fee structure, typically involving an annual management fee ranging between 0.5% to 1.5%, with most around 1%. Understanding these fees requires careful reading of each investment’s specific disclosure and registration statements.
• Additional Fees: Beyond the annual management fees, some investments may incur additional fees. While placement or origination fees are generally charged to the sponsor, the complexity and variety of fees necessitate a thorough understanding of the costs associated with each investment.
• Relative Newcomer: As a platform founded in 2015, EquityMultiple is relatively new compared to some of its competitors. This shorter operational history means it has had less time to establish a comprehensive track record, which might concern some investors.

Customer Support

Whether you have a question about an origination fee or the past average return, EquityMutiple’s dedicated customer support staff is always happy to help. While there is plenty of information about annual returns, historical performance, and applicable fees for investors available on the website, sometimes it’s just easier to talk to a real person. You can reach them via phone, by email, or through the chat function on the website.

• Phone service is available from 6 AM to 9 PM, Eastern Standard Time
• General questions can be sent to via email
• You can always reach a customer support agent by using the “Chat” function on the website. These agents are available 24/7.

EquityMultiple Alternatives

With the upside potential of diversifying your investment portfolio with crowdfunded real estate, it’s no wonder that many alternatives have popped up recently. Some of these options even present great cashflow opportunities for non-accredited investors. One of these platforms is Fundrise.

Navigating the real estate crowdfunding space, I’ve observed that both Fundrise and Equity Multiple offer compelling opportunities for prospective investors like us. One difference is that Fundrise is particularly approachable, especially for those who are new or non-accredited investors. They also have a low minimum investment requirements and annual management fees.

On the other hand, Equity Multiple’s niche lies in commercial properties, and they cater specifically to accredited investors. So, when we talk about choosing between the two, it really boils down to what aligns with your individual investment goals.

Read this EquityMultiple vs Fundrise comparison to see which is best for your investment strategy.

EquityMultiple Review Final Thoughts

EquityMultiple strikes me as the type of real investment platform that would inevitably be created one way or another. It’s a simplified way to get into commercial real estate investment, create a diversified portfolio, and leverage the power of crowdfunding all in one.

It’s also the kind of investment platform that a beginner RE investor can “grow into.” Investments are laid out in a simple, easy-to-understand way, with all the heavy lifting of due diligence having already been done.

It’s a little unfortunate that the investments aren’t very liquid. That said, liquidity isn’t one of the big draws of real estate – it’s the returns. You can find greater liquidity in REITs (including the crowdfunded REITs), but you also run the risk of having your investment be more closely tied to stock and bond market fluctuations in a conventional REIT.

Perhaps best of all, EquityMultiple is a great way to start investing in commercial real estate deals through your self-directed IRA. With as little as $35,000, you can diversify your investment across three separate real estate opportunities, without having to fill out three separate investment packets across three separate companies.

Click for EquityMultiple pricing and details.