Strategies for Raising Capital: New to Commercial Investing

[Jaden Ghylin]

Hello all, I am at a bit of a crossroads and could really use some guidance from others who have crossed over from residential to commercial properties.  I have built a solid portfolio of 9 single family rentals in the Minneapolis/St. Paul metro that have been cash flowing and appreciating well.  The market has gone up enough to where I don't think it's wise to purchase any more at current prices.  Additionally, it's time for me to scale up into larger properties rather than building the portfolio one at a time.  I have a few questions.  

With commercial properties it appears that it's better to be into higher value properties, generally over $2 million.  The financing is better and there are more revenues to pay for overhead, and management.  I have met a few commercial investors and I seem to hear this over and over again.  The properties under $1mln are undesirable unless they can be improved beyond $1mln.  So far, I have been financing all of my deals with local banks and my own personal funds.  Doing this, I could stretch myself into a $1mln property, but I'd be out of powder at that point and definitely can't get to $2mln.  I've also noticed that in commercial investing, it is very common for developers to not use any of their own funds.  They raise the down payment and finance the rest with bank financing.  This is completely new territory for me, but seems like the path I need to go down next.  It seems that crowdfunding websites can help with the regulatory and logistical aspects of raising capital.  Does it make sense for me to pursue a down payment capital raise through crowdfunding?  Most of the deals I see on these websites are from proven developers with a track record.  I have a track record in Single-family residential, but not commercial, so I'm not sure how that will apply.  If my track record is not sufficient to raise capital yet, can you give some pointers on what I can do to improve the track record to instill confidence in investors?  I can certainly take on a portion of the down payment myself, which may help.  Any other thoughts?  How have you all had success coming up with down payments on $2mln+ properties?  

I'd appreciate any insights or input you have to offer.  Thanks in advance.

Regards,
-Jaden