Fractionalized ownership reduces the cost of entry for investing in commercial real estate
A global pool of investors can access prime investment properties worldwide through a simple smartphone application interface
Digital exchanges can eliminate costs of intermediaries, improve settlement times and streamline the process through automation
Blockchain technology guarantees data transparency, enabling clear linking of the security to its underlying asset
The future of real estate investments?
In recent years reports from both the Massachusetts Institute of Technology (2020) and Oxford University’s Saïd Business School (2020) have examined the potential benefits of tokenization with regards to the future of commercial real estate investment.
They found that fractionalized ownership through tokenization can remove the high barrier to market entry due to upfront capital requirements and democratize access for smaller investors.
The lower cost of entry, simplified user interfaces and the global nature of blockchain unlocks a larger pool of worldwide investors, improving liquidity and thereby potentially increasing asset value.
Blockchain technology vastly reduces settlement times, while providing security and transparency. Essential when proving the clear link between securities and their underlying assets.
Smart contracts also enable the automation of processes such as compliance, trading and even divided payments, which removes the need for intermediaries, thus improving efficiency and further lowering costs.
University of Oxford
MITP Works in Progress