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Crowdfunded Development Gets Boost from New Securities Laws

In the U.S., investment in private development has long been limited to wealthy individuals; making the type of crowdfunding that raised $239 million from 3,100 people for a skyscraper in Bogota difficult. New securities laws should change that.

"The practice of crowdfunding real estate is spreading from South America — where Prodigy Network recently raised around $239 million from 3,100 Colombians to build a 66-story skyscraper in Bogotá — to New York, where the developer Urban Muse is hoping to offer a slice of a Brooklyn Bridge Park project to the public," reports Amy Cortese.

"That seemingly simple idea [crowdfunding development] is actually a radical departure from conventional practice, and requires some financial and regulatory gymnastics," she explains. "Under current law, only wealthy ‘accredited’ investors (typically those with a net worth of $1 million or more) are allowed to invest in private firms."

by Jonathan Nettler

Full Story: http://www.planetizen.com/node/63126

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