When Guerrilla Development opened up crowdfunding for its latest project, a two-building mixed-use development called Jolene’s First Cousin, the team figured there would be strong demand. An earlier project, the Fair-Haired Dumbbell (they have a penchant for quirky names to go along with their iconoclastic buildings), raised $1.5 million from 121 investors in eight months, using Regulation A.
But when the Jolene campaign hit its $300,000 target in just 72 hours in late December, even its developers were surprised.
Real estate has been one of the hottest segments of crowdfunding under the JOBS Act. Most real estate crowdfunding portals have shifted to REIT-style investing, which bundles many projects into one fund.
Jolene’s First Cousin stands apart—and not just for its name (which comes from an off-color, inside joke). For one, Guerrilla Development is well known in the community and its projects suit the idiosyncratic aesthetic of Portland, Oregon, where it is based. The project is relatively modest in scale, but it has an ambitious social mission: to help address Portland’s growing homelessness problem.
Jolene’s First Cousin, which recently broke ground and is expected to be completed by early 2019, involves the development of twin two-story buildings on a single lot in the heart of the Creston-Kenilworth neighborhood in southeast Portland. It will have three ground-level retail spaces and two market rate lofts that will help subsidize the project’s 11 single resident occupancy (SRO) rooms. The SRO rooms, which will share common space and amenities and rent for $425 a month, will be filled with the help of JOIN, a Portland-based nonprofit that helps the homeless transition to permanent housing. JOIN will also hold the master lease.
The success of the Jolene’s First Cousin campaign underscores how a unique venture and vision can resonate with investors who long to be part of something meaningful—and offers lessons for others looking to crowdfund similar ventures. […]
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