Real Estate Investment Problems and Solutions
Initially published on SmartReit
The Real Estate Problems
By creating a real estate blockchain platform, you will address the $280 Trillion Real Estate sector and $5 Trillion Private Fund industry, which fraught with many problems!
In real estate investments the private equity model is lucrative, but lacks the ability for active investors to trade their real estate interests on a daily basis at a reasonable net asset value.
The real estate industry is highly capital-intensive and less liquid than other markets.
The real estate investor’s world is comprised by large professional players, such as: high net worth individuals, banks, insurance companies and pension funds. Entry barriers prevent small investors from harvesting returns at the same level as the qualified players. Common investors are limited to investing only in collective investment formats such as real estate mutual funds where management fees are high and there is no way to choose and control opportunities.
One solution could be the development of a Real Estate Security platform focused on the practical application of Smart Contract and next-generation Blockchain technology, that offers Fractional Property Ownership (FPO) of different types of properties: office buildings, apartment complexes, student houses, commercial buildings, etc.
Harnessing the immutability of Blockchain and the convenience of Artificial Intelligence, a platform such as this can provide the state-of-art Security Token Offering Platform that consistently generates stable annual ROI.
With the implementation of a platform such as this, one can conveniently and efficiently resolve the issue of inherent illiquidity and fraught in a multi-trillion dollar investment market. Through the digitalization of actual real estate assets (sustainable apartments, residential areas, lands, etc.) an issuer aims to launch new markets and reduce operational costs, making real estate investment transparent, efficient, and open to masses.
The investment platform should be user-friendly, secure and understandable, focusing on transparency and legal property ownership, where safe returns are achieved from participation in real estate development projects.
In the process of developing sustainable real estate projects and building investment portfolios, the issuer must seek and offer investors an investment tool that helps them maintain a high level of security and diversification.