According to the real estate crowdfunding report 2020, published by Walliance, the first Italian real estate crowdfunding platform (RECF), together with Politecnico di Milano, as of 30 June 2021, the capital raised by active RECFs in Italy was € 157.87 million (of which € 90.43 million from lending platforms and € 67.44 million from equity platforms).
Since 2017, 469 campaigns have been closed and financed (47 in equity crowdfunding and 422 in lending). Only one unsuccessful campaign on equity portals and 5 on lending portals have been recorded.
The Italian RECF industry has developed in recent years and therefore lags behind other European countries. At the European level, the RECF industry has raised approx. € 5 billion, of which € 2 billion in 2020.
As of 30/6/2021, the Crowdinvesting Observatory of the Politecnico di Milano identified 18 platforms operating in Italy focused on real estate, of which 4 equity platforms (Build Around, Concrete Investing, House4Crowd and Walliance) and 14 lending platforms.
The RECF activity intensified in the second half of 2020 and the first half of 2021 when the raised capital reached respectively € 39.4 million and € 46.5 million.
Most of the financed campaigns concern projects developed in the north of Italy, particularly in Lombardy, with Milan alone accounting for 35%. Other core regions are Emilia Romagna (9%), Tuscany (9%), Piedmont (5%), Liguria and Sardinia (4% each). In addition, Walliance has also launched two campaigns to finance real estate projects in the USA.
Regarding the type of development projects, Italy is substantially in line with what happens in the rest of Europe. New construction projects are preferred to renovation projects (47%), and most of the campaigns refer to urban contexts (65%); rural/tourist represent 6% of total campaigns. In terms of destination of projects, residential accounts for 98% of the total financed capital.
The average equity capital raised through crowdfunding campaigns is € 1.43 million, while it is € 214k for lending campaigns. In addition, the average length of equity platforms’ projects is 23 months, while for lending projects, it is just over 15 months.
Many real estate projects are already completed, in particular 11 equity crowdfunding projects (with annualised returns of between 7% and 14%) and 171 lending projects. However, in the last 12 months, lockdowns and the Covid-19 emergency have led to delays. In some cases, moratoria on loans have been implemented. As a result, there were 30 delayed projects financed with lending platforms and 5 with equity platforms.
Finally, it’s interesting to look at how much crowdfunding capital affects the total budget of real estate projects. For equity RECFs, crowdfunding represents a minor fraction of the project development budget (on average 27%). On the other hand, for lending platforms the percentage tends to be more consistent because of the smaller size of the project; capital raised through lending platforms accounts on average 57% of the total project budget, and in almost a third of the campaigns the incidence reaches over 90%.
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The report (in Italian) is available at the following link: https://crowdfundingreport.walliance.eu