August 30, 2019 – Yesterday, I attended “New Perspectives on Investment – Real Estate Deals in the Digital Era” at Grand Hyatt Hotel in BGC. While industry experts from different fields tackle tokenization – a method of converting rights to a physical asset into a digital token, the event is also the soft launching of C Estates, the firm that is set to tokenized real estate properties in the Philippines and abroad. To borrow the catchy term, it’s putting real estate on the blockchain.
Real Estate, the biggest market in the world, is also illiquid. One cannot simply sell a property for cash just as fast as buying an item at a mall. Searching for buyers takes time; there are many administrative paperwork and procedures. Of course, the buyer and the seller will almost always need to see each other to visit the location. After all, purchasing a house, a condominium, any real estate property is a big decision for any person; it will probably be the single biggest purchase of their life. Additionally, not everyone can afford to buy a house. For the average daily wage earner, it is simply too big of a purchase and this makes the entire real estate market unavailable to them.
And that’s unfortunate because unlike other assets like stocks whose value can be zero if the company goes out of business, real estate will almost always have value. And while the industry remains stable and growing despite the large majority of Filipinos cut off from participating (Buying), there’s this company – C Estates, that wants to make the industry available to a wider audience.
During the event, C Estates Chief Operating Officer Eli Becislao unveiled their digital platform where users can buy and sell properties. A person can list their property, put all the necessary details (where is it located? Is it rented? How much?) and the platform will give an estimate on how much the property can earn in the marketplace.
The above paragraph reads like it’s Lamudi or Facebook Marketplace where users list their properties. Where’s the “making it available for everyone?” C Estates uses blockchain to tokenized the property. Say the property is worth Php 10 million. This number is tokenized; Php 10 million can be divided to 10M tokens where 1 token = Php 1 so anyone can buy a portion. If the property, whose title is in an escrow or trust, earns from rent or sale, the user gets revenue relative to the portion of of the tokenized property that they have. To learn more, send an email to email@example.com (Don’t forget to say that you’ve read about C Estates on BitPinas.)
Tokenizing properties sounds useful and will allow for wider participation from the broader market. This, according to founder Teru Sumida, represents an opportunity that is still not being solved. However, while C Estates and its platform are ready, our laws aren’t yet. The early portion of the event tackled the current regulatory landscape concerning tokenized assets. Tokenized assets will be using cryptocurrency and blockchain. While cryptocurrency is not legal tender, it is efficient in transferring value in a matter of seconds*. Cryptocurrency and other digital assets are subject to regulations set up by the Bangko Sentral ng Pilipinas (virtual currency exchange rules). And since C Estates is a trading platform, there will be an order-book; users set their buy and sell prices of the tokenized assets, and that is subject to the upcoming rules governing digital asset exchanges being formulated by the Securities and Exchange Commission (SEC). Nevertheless, C Estates is constantly engaging with the regulators in its bid to be one of, if not the first licensed digital asset exchange under the upcoming rules. As Mr. Becislao said during the event, the company is not about re-inventing the wheel, but more on innovating it to make it more efficient.
This article is first published on BitPinas: C Estates’ Blockchain-based Real Estate Platform is Ready to Disrupt
* The C Estates platform is built on the NEM blockchain which normally does not suffer from long transaction time that other blockchains are facing.