Historic preservation projects are designed to protect a community’s heritage often through the expansion and enhancement of historic properties for public use. Community capital is designed to empower a community’s investment in itself through public offerings that are structured to engage a variety of investors. Preservation projects could meet their goals faster and gain additional political and monetary support through the use of community capital raising strategies.
Community investment strategies differ from typical private strategies as they allow investment broadly from community members rather than restricting investment only to the highest net worth individuals or institutions. Community capital does not have to be the only source of capital for a project, but it can have an impact beyond the funds raised.
Community members can be great allies (or in some cases, strong adversaries) to real estate development projects. Restoring or repurposing a historic building is made easier if a developer has both capital and community support. Why not combine the two?
Including community members as investors in projects not only affects the project’s bottom line, but also impacts the level of community acceptance of the proposed purpose and use of the property. With a community capital approach, community members share in the potential return on investment and can become great ambassadors for the project as it wends its way through any approval process, and later as the property opens for its new or improved purpose.
At Cutting Edge, we work to identify, design and build capital raise strategies that meet client goals and strive to involve community stakeholders. Depending on the purpose and scope of the project, community capital raise strategies might include single, or multi-state, direct public offerings, Title III Regulation Crowdfund offerings or larger Regulation A campaigns. Or, a developer or manager can put together a community investment fund that can support various enterprises or projects. These approaches work not only for real estate projects but across a wide range of industries.
We will be highlighting these capital raising options in greater detail in a webinar (Crowdfunding Historic Preservation: Direct Public Offerings and Other Ways to Raise Funds) with the National Trust for Historic Preservation hosted by the California Preservation Foundation on Tuesday April 17th from 12:00 PM to 1:00 PM PT. To learn more and register, visit here.
For a free consultation with Cutting Edge Capital, visit here. Questions? Email firstname.lastname@example.org.
If you tuned into KALX, Berkeley’s 90.7 FM station, at noon today, chances are you heard Cutting Edge Capital’s Vice President Brian Beckon compellingly break down community capital on Method to the Madness with Lisa Kiefer, a weekly show that showcases the innovative spirit of the Bay Area. Click play below to learn more about the world of community capital.
Baah baah almost there!
The Economic Development and Financing Corporation is at 90% of its goal in its Direct Public Offering. California investors can help them reach their target by investing before February 9th.
Through a community-based Local Social Impact Investment Note, EDFC offers investors an opportunity for California residents to launch the Mendocino Wool Mill project – and shift their money from Wall Street to “Main Street.”
Learn more here.
San Francisco’s Mission Cheese is almost halfway to their goal of opening their new restaurant, Makers Common. With some of the most creative marketing out there, they literally put the investment opportunity on the menu with a $1,000 “founders special.”
In the words of one of their investors:
“I couldn’t pass up the opportunity to support local makers. By supporting Maker’s Common you’re also supporting all the small food producers they source from. Maker’s Common has created an opportunity for me to invest in my local community, and that’s an opportunity that doesn’t come by very often.” – Buck Lucas, SF, CA
Want to learn more? Mission cheese is hosting a Happy Hour for potential investors on February 8th @ 6:30 p.m. RSVP directly on their website.
Blazing the Trail
My Trail was born in Boulder, Colorado, out of a passion for the outdoors and a desire to bring to market the very best lightweight and functional outdoor clothing and equipment. T heir merchandise will be available on their website, and they eventually plan to open retail locations in Colorado.
After completing the DPO Lab (then known as the “DPO Boot Camp”), My Trail Company has raised $294,100 of its $800,000 goal, with 150 days to go! The 1st $200,000 they brought in funded production of their best-selling styles, an e-commerce launch, the opening of a new distribution center, and the hiring of core staff.
In their offering, investors purchase preferred shares directly from the company, earning 10% annual dividends, which will either be paid in cash or accrue from year to year and be paid upon a liquidation or certain types of redemption. Investors will receive a 20% discount on product purchases.
Investors in Colorado can find more about the opportunity on Cutting Edge X, the Direct Offering Marketplace. Learn more about My Trail.
Founded in 2012, CERO Cooperative is more than just a compost hauler in Massachusetts. They are built on the mission of improving their communities while doing right by the environment. Plus, as a worker-owned cooperative all their employees are deeply vested in their success. Turns out, their community is too! Unique as a bilingual, multicultural co-op, CERO completed a year long Direct Public Offering , raising capital by selling shares of dividend-paying stock to regular community people. Lenders who were initially hesitant to take a chance on lower income entrepreneurs in the green economy are now on board, and CERO is growing, providing the jobs it promised to workers who own the company. In one year, they raised over $350,000 from their community using our Online Investment Tool and CuttingEdgeX listing site. You can learn more about their story and growth in a short video on their website.
Investing in the Silver City
A graduate of our DPO Lab, (formerly known as “DPO Boot Camp”) the Murray Hotel has received regulatory approval to conduct a DPO in New Mexico. In the heart of Silver City, the Murray Hotel is a 1938 Art Deco hotel that celebrated the 75th anniversary of its original opening in 2013. The Murray Hotel is raising $600,000 by selling membership interests in the business through a DPO. Investors may earn up to 5% return per year. The funds raised in its DPO will be used for renovations of the hotel, including guest rooms and food facilities, and for marketing the hotel and its proximate location to amazing wilderness and cultural areas. On January 21, 2016, they held their first meeting with potential investors. Read more about the Murray Hotel in this article. Stay tuned for updates on their offering!