Today I received an email from Fundrise about a crowd funding opportunity to invest in 906 H Street NE LLC and was pretty excited about it. It would only cost $100 per share to participate in a DC real estate venture and it seemed like a great way to get involved with very little up-front investment. I decided to buy two shares, one for each of my daughters, and pressed the button to invest. Sadly, they will not allow Maryland residents to participate.
This is what the Fundrise Support page had to say on their site.
“The current securities regulation process (Regulation A) we followed for certain public offerings requires us to register each offering individually state by state. We are currently selling shares only to residents of Virginia and the District of Columbia.
Why is it not available to residents of Maryland?
Although we have spent more than a year working on a number offerings to register them in Maryland, we have found the regulatory burden too high. We have qualified the Fundrise 906 H Street NE LLC offering with the Securities and Exchange Commission (SEC) and have registered it in Virginia and District of Columbia.”
I emailed the Fundrise team to see if Maryland residents might be able to participate in future opportunities, and Laura Tischler of the Fundrise team said:
“We very much wanted to make our offerings available to MD residents and hope to do so in the future. States’ methods for registering and reviewing securities vary. It’s difficult for us to predict what may happen with any future offerings, but we continue to look at expanding our offerings to other states.”
So, I decided to call my Representative to see why Maryland’s regulatory burden was too high for Fundrise to allow MD residents to participate. I spoke to Josh at John Delaney’s office who recommended I call my state representatives. So I called and emailed Robert L Garagiola. Diana in his office thought it might be an issue that could be answered by the Comptroller, but is looking into this for me.
If you are a Maryland resident and would like to know why Maryland’s regulatory burden is preventing you from participating in Fundrise opportunities, type in your address and find your local representatives at this site. Let your representatives know what you think. Maybe we’ll be able to participate in Fundrise’s next opportunity.