How developers are rewriting their funding mix

Property developers are increasingly looking for capital beyond banks. One of the beneficiaries of this trend is lending-based crowdfunding, which – following regulatory changes – is trying to secure a permanent place in the real estate market.

For years, the main sources of financing for development projects have been bank loans, bonds, and equity. In recent years, however, lending-based crowdfunding has also begun to make itself felt more boldly.

Although its share in financing the sector remains small, an increasing number of companies are testing whether it can serve as an effective complement to traditional sources of capital. There are several reasons for this shift. The most important are the speed of raising funds and the potential for greater diversification of financing sources.

One such attempt is currently being made by Trust Investment. Through the Crowd Real Estate platform, the developer launched a fundraising campaign on June 16, 2026 (starting at 9:00 a.m.) for a residential project called “Ultradom” in Radom. The target financing volume is PLN 11 million (approximately EUR 2.6 million).

Not just banks and funds

Does this mean crowdfunding will replace traditional sources of financing?

“Diversification is key. We are absolutely not giving up bank or fund financing. Crowdfunding is one of the elements of the financing model we have decided to test. We have never used this structure before, so we also see it as an opportunity to get to know a new market and new investors,” says Patryk Barucha, CEO of Trust Investment.

Large-scale developers are increasingly looking for flexible solutions. This allows them to run several projects in parallel and respond more quickly to changing market conditions. This does not mean, however, that crowdfunding is cheaper than bank loans. Quite the opposite.

“Of course, crowdfunding is more expensive than bank financing. On the other hand, the process is much faster, and time matters enormously in our sector. A bank agreement offers different possibilities than crowdfunding financing. Each of these tools has its own role and limitations,” Barucha notes.

Financial market experts also do not expect crowdfunding to replace banks.

“Crowdfunding has a chance to become a permanent fixture in the market, but I do not believe it will fully replace bank financing. It is, however, a very good alternative as supplementary or even standalone financing for niche projects, where a bank would tell a developer ‘no,’” says Elżbieta Chmielowska, Director of the Real Estate Financing Office at BNP Paribas Bank.

According to the expert, crowdfunding’s advantages may include lower formal requirements and greater flexibility in the process. 

New regulations have changed the market

The development of the market has also been supported by regulatory changes. Since November 2023, crowdfunding platforms have operated under a new legal framework stemming from the European ECSP regulations. The current market bears only limited resemblance to what it looked like a few years ago.

“First, we need to demystify the crowdfunding market itself. Before the new regulations came into force, it operated in completely different conditions than today. There were entities on the market that negatively affected how the entire sector was perceived. Today, we operate in a very different regulatory environment. As Crowd Real Estate, we hold a license from the Polish Financial Supervision Authority (KNF), and we are trying to educate the market and build investor trust,” says Paweł Krzystek, Member of the Management Board for Risk at Crowd Real Estate.

Platforms operating under the new rules are subject to supervision and must comply with specific disclosure requirements.

“On the KNF side, there is a dedicated department responsible for parallel banking that supervises our activities. We comply with both Polish regulations and European crowdfunding rules,” Krzystek adds.

The information provided to investors is also crucial. Each offering must include a document specifying project parameters, risks, and investment conditions. This allows investors to more easily compare individual offers and make more informed decisions.

Project quality comes first

The growing popularity of the market does not mean that every project has a chance of being listed on a crowdfunding platform. Investment selection is one of the key elements of how such platforms operate.

“We do not focus exclusively on the developer’s financial performance. Of course, we analyze their financial standing, but equally important to us are the project itself, its stage of advancement, the developer’s experience, and the quality of the collateral. It is precisely the project and the collateral that are crucial for us,” emphasizes Paweł Krzystek.

For crowdfunding platforms, credibility is at stake above all else.

“We are very focused on the quality of the project portfolio. We are held accountable for any delays or problems related to project repayments. That is why we do not prioritize quantity, but above all quality. Losing investor trust would be very difficult for any platform to recover from,” adds the Crowd Real Estate board member.

Banks also pay attention to similar elements when assessing investments.

“In real estate investments, the most important factor is the project’s location. The next step is to assess the experience of the entity executing the project – both in construction and in managing the sales process,” notes Elżbieta Chmielowska.

But that is not all – financial risk considerations are also important.

“It is also worth discussing with the partner the rules for financing potential cost overruns during implementation. In the current macroeconomic environment, even a fixed-price general contractor agreement does not fully eliminate the risk of rising costs,” the expert adds.

Investors need to learn a new market

In Poland, real estate crowdfunding remains relatively little known. The picture looks different in more developed markets.

“Crowdfunding is very well developed in Western Europe, particularly in France, the Netherlands, and Austria. It is a popular complement to traditional forms of investing and financing real estate projects,” says Paweł Krzystek.

However, the list of countries where such solutions are successfully used is longer.

“The most developed crowdfunding platforms today operate in the United States and the United Kingdom. Spanish and French markets are also developing very strongly. We would like Poland to follow a similar path. The potential is significant, although awareness of this form of investing remains limited,” adds Jan Szewczyk, Head of Marketing at Crowd Real Estate.

The popularity of this and other forms of investing or capital raising will also depend on another factor: the level of financial literacy in society.

“In Western Europe, financial education is at a much higher level than in Poland. People have larger financial surpluses and have been learning various forms of investing for years. Here, this process is only just beginning. This is one of the biggest challenges for the entire crowdfunding industry,” assesses Patryk Barucha.

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Market development does not depend solely on attractive investment offers.

“This is not just a matter of marketing. People need to understand what crowdfunding is and how to assess the credibility of platforms and projects. Investor education will be key to the further development of this market,” adds Paweł Krzystek.

Will crowdfunding become a permanent feature of the market?

Industry representatives agree that the development of crowdfunding will be a gradual process. A sharp disruption should not be expected.

“Investors need to get comfortable with this model, see that projects are delivered as planned and that it is possible to earn money on them. Trust is built gradually, not within a few months,” says Paweł Krzystek.

At the same time, platforms are not trying to compete with banks in the traditional sense.

“We want to complement the offering of banks and other financial institutions. Banks have their own limits and constraints. We can provide an additional source of capital that increases the flexibility of project financing,” adds the company’s management board member.

A similar view is expressed by the developer’s representative.

“It is difficult today to say what share crowdfunding will have in the market in five years’ time. It depends on many factors. If we look at the experience of Western Europe, we can assume we will move in a similar direction,” says Patryk Barucha.

Lending-based crowdfunding will not replace banks or investment funds. It may, however, become an important part of the financial ecosystem of the real estate market – especially at a time when developers are seeking greater flexibility and retail investors are looking for new ways to allocate capital.

How large this segment becomes will depend primarily on project quality, the effectiveness of regulation, and the trust of market participants.

Key Takeaways

1. Lending-based crowdfunding is gradually moving out of its niche and attracting the attention of larger developers, who treat it as an additional source of capital alongside bank loans, bonds, and investment funds.
2. The success of this market will not be determined by the number of completed issuances, but by the quality of the financed projects. Even isolated repayment issues or delays can negatively affect investor confidence and slow down the development of the entire segment.
3. EU regulations have created a more transparent and secure operating environment for crowdfunding platforms. However, further market growth will depend primarily on investor education and the long-term building of trust in this form of capital allocation.