SACRAMENTO (CBS13) — A Sacramento developer is turning to crowdfunding to build the city’s newest apartment project, promising investors part ownership.
The first-of-its-kind plan for the Sacramento city skyline is for a new Midtown apartment project.READ MORE: Sacramento County Tackles Zip Code Vaccine Disparities
“We think crowdfunding is going to bring them the money and quick,” said Lanford Tobe.
A nine-story mixed-use project called I15 is slated to be on what’s now a dilapidated corner at 15th and I streets. Tobe works for the consulting firm who is using the Internet to find investors from all over the country.
“What they need is $6 million,” he said.
Tobe hopes to find people willing to chip in as a part-owner, then see their money grow once the project is built.READ MORE: Feds' Boogaloo Indictment Details Inside of Northern California Extremist Group
“It’s a good area to invest in, to live in and to run a business in,” he said. “It’s a growing area.”
We asked Sacramento State professor of finance Sanjay Varshney if this type of real-estate crowdfunding project could work in Sacramento.
“I commend the people who are trying to pull it off, but I don’t think its going to be an easy road, not in a place like Sacramento,” he said.
He believes the fundraising method is better suited for markets like the Bay Area or Los Angeles.
“If you look at Sacramento, crowdfunding may be possible for very small projects and projects that have very large appeal from masses of people that actually believe in your concept or they believe in your purpose,” he said.MORE NEWS: Stockton Teen, 14, Shot While Driving Left Paralyzed
The developers are hoping to get around six investors to split the cost to begin building, but they haven’t received any offers yet.