Scott Picken is the author of “Property Going Global” and the founder and CEO of Wealth Migrate, an online global real estate investment marketplace. An expert in the intersection of technology and global real estate markets, Picken combined his lifelong passion for IT with 17 years of real estate investment experience to actualize the dream of Wealth Migrate as a crowdfunding platform. Wealth Migrate’s leadership team has been part of $1.34 billion in real estate transactions worldwide, and the platform offers investors access to quality opportunities and partners in first world markets with investment minimums as low as $10,000. Originally from South Africa, Scott founded his first real estate investment firm at age 26, International Property Solutions (IPS). Through IPS and Wealth Migrate, he aims to revolutionize the real estate industry through crowdfunding technology and provide a single hub for real estate investors to effortlessly build wealth and safely manage their portfolios.
I’ve spent my entire career in real estate in some capacity, first as a property developer in my native South Africa, and later as a developer in myriad international markets. As is the norm for anyone serious about developing real estate, I’ve always leaned on a strong network of investors to fund deals. As I became exposed to the idea of using crowdfunding to fund properties, I realized that it was something I actually had a lot of experience in already. It was a natural progression to leverage technology in order to further my reach in the global real estate marketplace.
This led me to launch Wealth Migrate, a real estate crowdfunding platform for accredited investors seeking global opportunities. My team has experience that touches over $1 billion in global real estate transactions. This is our core competency, we’re just using technology and some new regulatory exemptions to try and take our business to the next level. The Internet allows us to expand our network of investors in a really profound way, and that network stands to benefit greatly from our combined experience in the global marketplace.
Trends in global real estate investment clearly point to increased money movement across borders, a trend that crowdfunding stakeholders like myself see as an incredible opportunity not only for developers, but also for the platforms themselves. It’s getting harder and harder to find solid opportunity and that is forcing global investors to cast a wider net in search of returns. Over 7% of all residential real estate investment in the United States in 2014 came from overseas, for example. That trend will only continue in the next five to 10 years.
Crowdfunding stands to increase this access to foreign capital for developers and property managers in the United States. By making real estate investment opportunities easily accessible on the Internet, this increases transparency and makes it much easier for investors to find potential opportunities and perform due diligence. It’s a very natural progression in the global real estate market. I really think it is only a matter of time before this type of online investment is commonplace.
If we’re talking about the United States, one obvious candidate is senior housing, a market that my team at Wealth Migrate has really taken a keen interest in and watched closely recently. The rapidly changing demographics of the United States are well-documented at this point. In 2009, almost 13% of the population in the states was over the age of 65. That is expected to increase to 19% by 2030. This is going to have an incredible effect on the U.S. real estate market and create some serious opportunity for those that are in a position to take advantage and smart enough to spot the trends. It isn’t just housing, either. There is a lot of infrastructure that goes hand in hand with supporting that kind of a demographic swing. Q4 2014 saw over $3 billion in sales in medical office buildings, for example.
However, I try not to get caught up in what the current trends are because I think that mindset undermines one of the most exciting aspects of crowdfunding. The crowdfunding marketplace is poised to be very flexible in reacting to trends in the real estate market. The real question is, what is the next big real estate opportunity? I really think crowdfunding will be there in a big way, and early investors will be poised to take advantage.
Perhaps the more cautious set will take a watch and learn approach, but while they’re watching and learning, thousands of accredited investors are putting skin in the game right now and taking an active interest in some pretty phenomenal properties in the United States and around the globe. Like I said, I think the early participants will reap the benefits of being first to an incredible way to access quality investment opportunities. Those on the sidelines may be wishing they had explored this marketplace earlier.
Also, I’d encourage anyone considering investment to keep in mind that crowdfunding does very little to change the fundamentals of real estate investing. It only makes deals easier to find and an investment position easier to track and monitor. I’d encourage all investors to look into the platforms and get a level of comfort with the entrepreneurs behind them, but past that it’s a bit of a different look for a very familiar game. I say get involved. Fortune favors the bold.
Bad actors are always a concern in any nascent marketplace, and especially one that has such a low barrier to entry. The vast majority of participants in the investment crowdfunding space are not only qualified, but incredibly brilliant. Just about all of the stakeholders in this industry desperately want to build an incredibly robust and forward-thinking investment marketplace, but whether or not any specific platform carries this ethos… that’s a call for the individual investor to make.
That is why it is so important to understand the human beings behind any investment crowdfunding platform, and especially platforms in the real estate vertical. It’s very difficult to create a robust platform with the tools investors need to both make the right decision before investing and monitor the health of their investment on an ongoing basis. Trust that the platforms you want to be involved with have some incredibly talented minds behind them. Find out who they are and what makes them tick and you’ll be prepared to make a sound decision.
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