Things haven’t been great operationally at Landa, meaning a previously-overlooked canary in the coal mine is taking flight. This practice has recently come under heavy fire. CEO Yishai Cohen and former CTO Amit Assaraf started the company to democratize real estate investment. Now, it all starts with a $5 investment for users! The firm is now dealing with a tidal wave of complaints from its 766,000 registered investors. For instance, many public investors have to wait months to draw their investments down or collect dividends.
It enabled anyone to purchase and trade fractional shares of real estate and delivered live performance data on their assets. At the time as of January 2023, Landa has already paid out over $13 million in dividends and interest. Everything changed in January, when out of the blue one of the users began to withdraw his dividend payments. This alone has led to more than 130 complaints to the Better Business Bureau.
Service Disruptions and User Complaints
As of May 23, Landa’s app has gone dark and their investor portal is temporarily offline. Users trying to access the portal are instead directed to a “come-back-soon” maintenance page, creating outrage and uncertainty from investors interested in the program. Users, including ourselves, have been frustrated by Landa’s lack of communication surrounding the silence on their accounts and held funds.
One user stated, “I repeatedly emailed them about it and just got deflecting answers, nothing real.” Another added, “They have essentially frozen me out of my funds and just shut down the app.” Each of these comments shows the clear and dangerous trend that Landa’s faithfulness to its investors is diminishing amidst a lack of operational transparency.
Things turned south very quickly when a lawsuit was filed against Landa. The lawsuit further alleged that the company was terminated as the manager of homes and that an independent property manager and chief restructuring officer were installed in their places. This legal action makes the future of Landa and its investors even more uncertain.
Executive Changes and Company Response
The stormy seas inside Landa are further attributable to a revolving door at its executive suite. Amit Assaraf, the company’s CTO until December 2023, has recently left the company. This departure brings even more questions on Landa’s shaky leadership tenure in such a critical transitional period.
In answer to the operational troubles, CEO Yishai Cohen admitted the platform’s challenges had taken a toll on the platform. He reassured investors, stating, “We are aware of the issues currently affecting our platform and product, and want to assure all investors that we are actively working to restore full functionality as soon as possible. We have kept investors informed through all updates, including the server access issue.”
Despite Cohen’s assurances, many users remain skeptical about Landa’s ability to resolve its current challenges effectively. He emphasized that the problems do not relate to dividends but are instead server-related: “It’s unrelated to dividends. It’s from our servers. We are on it.” Cohen’s statements are a perfect example in showing the commitment to the technical challenges and keeping the investor confidence.
Future Outlook for Investors
The future of Landa is still very much in question as it continues to wrangle with legal challenges and operational turmoil. The appointment of an independent property manager suggests that significant changes may be on the horizon for how Landa operates and manages its assets. Depositors are made to question whether they will ever see their assets again, or if even more difficulties await them.
What was once the platform’s primary selling point—the promise to democratize real estate investment—now takes a back seat to heavy user dissatisfaction and growing operational challenges. The impact The current lawsuit combined with the high rate of executive turnover casts doubt on Landa’s ability to make good on its promise to investors.
