Canadian securities regulators review Vancouver real estate ‘crowdfunders’ after SCMP report

Securities regulators in Canada are reviewing the activities of two Vancouver real estate “crowdfunding” firms, after the South China Morning Post reported on apparent efforts to create investor syndicates drawn from the city’s Chinese community to buy properties worth tens of millions of dollars.

British Columbia Securities Commission spokesman Richard Gilhooley on Friday confirmed that the commission was conducting the review of Suncrowdfunding and Canada Luxmore Crowdfunding  and their associated entities.

However, he said he could not comment on whether a formal investigation into the firms was already underway.

The review comes after the Post’s Hongcouver blog on Wednesday published an investigation of Suncrowdfunding, which is associated with Sun Commercial Real Estate (Suncom); and Luxmore Crowdfunding, which is linked to Luxmore Realty, which describes itself as the “world’s first crowd-funded real estate brokerage”.

Both have been linked to multimillion-dollar projects amid Vancouver’s soaring real estate market. However BC crowdfunding – the mass online recruitment of investors – is regulated by BCSC rules introduced last May  that limit firms to raising C$250,000 per project and a maximum of two projects per year. Individual investors are limited to C$1,500 per project.