Crowdfund Insider | By JD Alois | May 31, 2016

Prodigy Network is one of the largest entrants in the real estate crowdfunding sector within the US.  To date, Prodigy has raised approximately $160 million for its portfolio of property located in New York City.  What is unique about Prodigy is the fact it is the developer for each project – something no other real estate crowdfunding platform does. Prodigy also stakes a claim to perhaps the largest investment crowdfunding offer ever in the skyscraper development in Bogota named BD Bacata.

Founded by CEO Rodrigo Niño, Prodigy is determined to give investors access to what they believe is the best real estate in the world.  Recently Prodigy has started to expand its message to a wider audience of international investors. Simultaneously the global economy is showing signs of slowing down. Crowdfund Insider recently caught up with Rodrigo to gain perspective as to what they are seeing in the market and what Prodigy’s plans are for the future.

Crowdfund Insider: How are things going at Prodigy?  I understand you are still focusing solely on Manhattan real estate as it is viewed as a safe harbor.

Rodrigo Niño: Things are going really well! Since we began our crowdfunding model in the United States, we have grown exponentially and today we stand as the leading real estate crowdfunding platform in the country.  Our current portfolio consists of 4 projects in Manhattan, valued at approximately US$650 million. This portfolio has been financed by USD $160 million of equity from thousands of investors, located in 23 different countries and 25 states within the US. Additionally, we have received traditional financing from global institutions such as CIBC, Deutsche Bank and Bank of America, for more than US$400 million.

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Another significant milestone that we are proud to share is the full completion of the first cycle of our project, AKA United Nations, which generated annualized pre-tax returns of approximately 30%.

Due to the fact that I’m a native Colombian, we consolidated a small portfolio of projects in Bogota. However, the crowdfunding for these projects is always done among Colombians only, given that the vehicles are structured in pesos, and we do not want to expose foreign investors to the currency risk. Asides from this, we are focusing solely on institutional quality commercial real estate located in Manhattan, since history has proven that during times of recession, these assets tend to protect the capital, and in times of growth they increase in value.

Crowdfund Insider: Do you see any signs of an economic slowdown? Or perhaps increasing concerns of slower economic growth?

Rodrigo Niño: I wouldn’t say that we see signs of economic slowdown, but rather signs of uncertainty and skepticism. This is evidenced by the high levels of volatility in nearly all liquid markets, which we see in the constantly fluctuating prices of oil and currencies of emerging markets.

In times of recession, investors tend to make a flight to quality, which is moving their capital from riskier investments to those that offer some level of protection, like Treasury bonds or gold. We have also seen that many investors seek safety by investing in hard assets in historically stable markets and currencies, like the assets we offer. Hence, even though there has been uncertainty in the last few months, we have seen increasing interest in our assets.

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Crowdfund Insider: Earlier this year you reported a very solid exit for some of your investors. Can you share the specifics?

Rodrigo Niño: As mentioned, last January we provided returns to our crowd investors who participated in the AKA United Nations project. This building is located in Manhattan’s Midtown East neighborhood, less than two blocks away from the United Nations headquarters. The 20-story building is comprised of 95 spacious, contemporary designed, fully furnished one-bedroom apartments equipped with a kitchen, living room and dining room.

In the summer of 2014, we raised over USD $12 million in equity from investors from 11 countries, for the renovation of AKA United Nations. This equity, along with equity from the sponsors (Prodigy Network and Shorewood Real Estate Group) and traditional financing from Bank of America and Vanbarton Group (previously Emmes & Co.) were used for the acquisition and renovation of the 95 unit building. In October 2015, AKA United Nations opened its doors, becoming the first crowdfunded building in New York.

After four months of operation, we recapitalized the deal, liquidating the investment of our crowd investors providing annualized pre-tax returns of approximately 30%.

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