Tokenization of real estate in the world: 3 particular experiences

Imagine having to buy an apartment every time you want to visit a city: this absurd rule would only allow a privileged few to go on vacation. This is why there are services like hotels and AirBnb, which allow people to travel in a much more affordable way.

Similarly, we at Alyon think that investing in the hotel sector should be within the reach of everyone, and not just an elite who can afford sky-high amounts of money to own a hotel.

The practice of tokenization of real estate adopted by Alyon has already begun to take root in the world of real estate: in this article, we are going to analyze three particular cases of use of blockchain for the sale and management of real estate structures.

1. Luxury condominium in Manhattan (New York) – $30 million

12 units of 160 square meters each, with a total value of $30 million: these are the figures of the first large structure in New York to be sold completely in the form of digital tokens. Ryan Serhant, the broker behind this futuristic transaction, released the following statement:

[INSERISCI CITAZIONE]

«The market in New York is always strong, but it can take some time to sell for the right price in a new construction building. With blockchain tokenization, we can remove the unruly pressure of traditional bank financing, which is much healthier for the project and all of the stakeholders. Tokenization is paving the way for a new forefront in real estate development»

Through tokenization, the luxury condominium was quickly sold to investors from all over the world.

2. Villa AnnA, Boulogne-Billancourte (Paris) – €6.5 million

Erected in a small village near Paris, Villa AnnA is the first major European real estate property to be sold entirely through digital tokens.

The sale followed three steps:

  1. The purchase of the property and transfer of ownership to a specially created joint stock company;
  2. Division of the company into 10 shares;
  3. Division of the shares into 100,000 tokens each.

At the end of this process, Villa AnnA was actually divided into 1,000,000 tokens worth €6.50 each, for a total figure of €6.5 million – equal to the value of the property. This strategy ensured that fragments of the property were acquired by a large number of investors, laying the foundation stone for the tokenization of real estate in Europe.

3. Emirates Blockchain Strategy (UAE) – ~€2.5 billion saved annually

In 2018, the United Arab Emirates made headlines with the Emirates Blockchain Strategy, a state project that aims to convert 50% of government transactions to blockchain by 2021.

According to calculations made by the Security and Commodities Authority (the emirate state body that regulates the country’s domestic market), this project would save:

  1. 11 billion Emirati dirhams (€2.5 billion) in transition and document expenses;
  2. 398 million documents printed annually;
  3. 77 million labor hours annually.

But, of course, saving money is not the country’s only goal: through this project, the UAE is counting on introducing tokenization via blockchain within the state, attracting new investors from all over the world thanks to the benefits guaranteed by this new technology. A great prospect for the real estate sector, included in the emirates tokenization projects.