Frequently Asked
Questions
The Average Annual Return is a simple metric that divides total profit over the project life by the holding period, while IRR (Internal Rate of Return) accounts for the time value of money and the exact timing of each cash flow. IRR is the more rigorous measure for comparing investments of different durations or with uneven distributions. Each project page on Freehold Crowd publishes both numbers so you can sanity-check the headline return against the actual cash schedule.
Focus on four indicators: net domestic migration, employment diversification, building-permit pipeline relative to absorption, and land supply. Freehold Crowd concentrates on South Florida — Miami-Dade, Broward, and Palm Beach — because all four indicators have pointed the same direction for more than a decade: persistent net in-migration, an expanding finance and tech base, constrained developable land, and stable absorption of new luxury for-sale product. Each listing includes the market analysis our team ran before underwriting the deal.
Choosing the right development team begins with reviewing each sponsor’s track record on the Freehold platform — completed projects, hit ratios on pro forma targets, and post-construction value realized. Each project detail page links to the developer’s public profile so you can compare experience, capital base, and prior outcomes before committing. We won’t list a sponsor we wouldn’t co-invest with ourselves.
Freehold Crowd is open to verified accredited investors under SEC Regulation D, including US individuals, US entities, and qualifying international investors. Accreditation is confirmed through VerifyInvestor.com using either an income test ($200k single / $300k joint for the last two years), a net-worth test ($1M excluding primary residence), or a qualifying professional license. Once verified, you can browse live projects, review financial summaries, and commit equity directly from your dashboard.
Freehold focuses on luxury residential development — primarily single-family and small multi-family for-sale projects. Broader real estate asset classes include multifamily rentals, office, industrial, retail, hospitality, and specialty assets like data centers or self-storage. Each class has a distinct risk, return, and liquidity profile. Ground-up residential development typically targets higher absolute returns than stabilized rental product, with shorter holding periods and binary exit risk tied to the construction and sale window.
Both metrics describe profitability but answer different questions. Average Annual Return tells you the simple yearly yield; IRR tells you the compound annualized return that makes the present value of all inflows equal to outflows. For development deals where capital is called and returned at irregular intervals, IRR is the analyst’s preferred benchmark — it correctly weights the timing of each draw and distribution. Use Average Annual Return for quick comparison of similar-duration projects; reach for IRR when timing differs.
Minimums vary by project — typically starting at the equivalent of one equity unit per deal. The unit price is set by dividing the project’s required equity by the number of units offered, so a $5M equity raise split into 500 units prices each unit at $10,000. Your projected return is calculated on a per-unit basis, which makes diversifying across multiple projects (and multiple sponsors) straightforward.
Distributions are paid out when the project hits its return milestones — typically at sale, refinance, or scheduled interim payments depending on the deal structure. Equity investors share in proceeds via either a Simple Split (pro-rata) or Waterfall (preferred return, then promote) structure, both disclosed on the project page before you invest. Development-loan positions pay fixed interest on a defined schedule and are repaid before equity holders. Every distribution is reflected in your dashboard with a downloadable record for tax filing.
Ground-up real estate development carries construction risk (cost overruns, schedule slippage), market risk (rents and sale prices at exit), entitlement risk (permitting delays), and sponsor execution risk. We mitigate by: limiting projects to South Florida markets we know directly, vetting sponsors against a track record threshold, building contingency into every pro forma, and stress-testing returns under a downside scenario published on each listing. There is no FDIC-type guarantee — investors should commit only capital they can hold through a multi-year project life.
Equity in private development projects is illiquid by default — there is no public secondary market. Freehold Crowd is building a peer-to-peer marketplace where investors can list units for transfer to other accredited members, subject to sponsor approval and securities-law restrictions, but the safest assumption is that you hold to project exit. Plan position sizing accordingly.
Freehold Crowd is compensated primarily through a small platform fee built into the project structure — disclosed on each listing’s financial summary — and, where applicable, a share of the sponsor’s promote. You won’t see a separate AUM fee, ticket fee, or recurring management fee charged directly to your account. The number on the deal page is the number that comes out of your projected return.