With tight lending standards, some developers are searching for alternative sources of funding. Chicagoland builder George Caravelli is looking at the crowds to fund his project.
According to Chicago Real Estate Daily, crowdfunding is “appealing for money from a wide net of sources beyond traditional lending institutions.” This form of fundraising is especially popular in the independent music and film industries, but developers are starting to adopt the system as well.
Caravelli plans to build a 70-home subdivision in Chicago’s northwest suburb of Lakewood. He wants to raise $2 million, and he’s calling on any interested (and accredited) investors. He promises an 8 percent fixed return plus a percentage of revenue.