A Portland startup is aiming to turn commercial real estate into the next field for crowdfunding investment.

BuildingBits allows customers to invest as little as $1,000 in a commercial building. The company evaluates and selects individual buildings to present to investors to purchase. Investors can then purchase a share. Once a fundraising goal equal to the purchase price is reached, a property passes into escrow.

BuildingBits’ platform is registered with the Securities and Exchange Commission. BuildingBits received SEC approval in September, and founder Alex Aginsky is now moving quickly to launch the business.

“That was a very long, complicated, arduous and expensive process,” Aginsky said of SEC registration.

Investors purchase a share of a limited liability company that will own a particular building. The LLC is formed at the time of closing.

The idea of using multiple small investors to build or purchase real estate is not unprecedented. The closest local comparison may be Kevin Cavenaugh’s Guerrilla Development, which used a crowdfunding model to back development of the Fair-Haired Dumbbell building.

Aginsky said his model has some similarities to Cavenaugh’s, with a few key differences. Cavenaugh’s investments were limited to Oregon residents, while Aginsky is casting a wider net. And Aginsky is looking to replicate the crowdfunding model repeatedly.

Aginsky’s pitch is that many small-scale investors such as schoolteachers could come up with $1,000 to invest in a building.

“This is an opportunity for them to dip their toe in the water and try this out and to receive regularly occurring dividends,” he said.

BuildingBits has 12 employees, and headquarters in the Pearl District. Aginsky said he conducted a successful round of fundraising in late 2016 and is embarking on another round now. Aginsky said he was heading to Silicon Valley shortly for a series of meetings with potential funders.

Aginsky said he plans to launch a trading platform next year where investors could buy or sell the building shares.

“In theory, we envision someone could buy a share of the Walgreens down the street and trade and sell those whenever they want,” he said.

Users can essentially create their own real estate investment trusts by focusing on a particular area of interest in the market, he said.

Aginsky previously founded Aginsky Capital Group, a boutique property investment firm for wealthy investors outside the U.S.

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