City Paper is not for tourists
A 45-unit residential building is coming to 1326 Florida Ave. NE, and crowdfunding from 37 small investors through Fundrise will be responsible for $650,000 of the financing.
Founded in 2010 by brothers Ben and Dan Miller, Fundrise began as a novel way of funding development projects by bundling small investments from community members, but the firm hit the big time this May when it raised more than $31 million from major national and foreign investors. The company recently raised $1 million for a project in the Hamptons on Long Island, but the $650,000 haul for the Florida Avenue project, just off the H Street NE corridor, where Fundrise has been active, is the most the company has raised for a D.C. project to date, according to Dan Miller.
Ditto Residential is building the project, which will consist of 45 apartments—-mostly micro-units as small as 312 square feet, with a few larger ones up to 1,000 square feet. Construction is scheduled to begin this fall and conclude in time for residents to move in late next year. Ditto has completed a number of boutique residential projects in the District, including a renovation of the iconic Round House in Brookland, but this is its largest project to date.
Miller says his company’s fundraising has been “steadily increasing” from the early days, when it would typically bring in around $325,000 or $350,000. “We’re also starting to get larger checks,” he says. “People are getting more comfortable with investing on real estate online.” The largest investment in this project was $200,000, according to Miller, with the top five or six investments comprising about half of the total investment. Thirty-five percent of the investors are from D.C., Maryland, and Virginia.
Still, Fundrise’s contribution is only about 5 percent of the project’s total financing, which comes out to $14 million. Miller says Fundrise is “becoming a more significant source of capital for these deals.” He expects Fundrise to be raising money for a couple of projects per month this fall, and while he can’t name specific projects in the pipeline, he says there are a few in Petworth and Columbia Heights, on 14th Street NW, and, of course, on H Street.
This post has been updated to include a more accurate figure for the largest investment in the project. Miller initially said it was about $100,000, and later corrected that to $200,000.
Photo via Rubenstein Public Relations for Fundrise