Real estate is an illiquid asset class and existing securitisation models may be costly, time-consuming, and inappropriate for most investors. Factors that can slow down real estate transactions include inefficiencies in price discovery, due diligence, and data security.
In the article titled “Real estate tokenisation: an emerging trend” which was published in the 25 November 2022 issue of The Business Times, Rajesh Sreenivasan (Head, Technology, Media & Telecommunications), Norman Ho (Senior Partner, Corporate Real Estate) and Regina Liew (Head, Financial Institutions Group) note that tokenisation and the blockchain protocol for property are gaining traction around the world. This is so because of the benefits that players in the real estate industry can derive from real estate tokenisation. Among others, tokenisation can help to standardise data formats and provide a single cost-effective solution for multiple processes in a secure platform. Tokenisation can also augment existing markets and unlock new business opportunities for investors.
The authors highlight that the emerging trend of real estate tokenisation has the potential to revolutionise the real estate market for investors, businesses and consumers. However, like all new technologies, this requires a balancing of industry, market and regulatory readiness.
