Real estate is out of control. And for most of us that makes it out of reach too. So as house prices continue to skyrocket and the reality of obtaining your own piece of brick and mortar becomes more and more unattainable for the majority of people, what are the next steps that we can take to ensure that the next generation still gets their piece of the pie?
Enter Tokenisation.
By now you’d have been sleeping if you hadn’t already heard of blockchain technology. But as the financial world starts to spin faster and faster, The tokenising of real estate into virtual fractions might be what keeps the next generation in the running. The ability to divide real estate value into bite-sized chunks has opened up new doors for those who wish to get involved. Now companies like Azqira are taking it to the next level by aiming at giving anyone their shot at a piece of luxury real estate in the hospitality industry. But why?
Let's face it. There are very few of us who’d even be able to dream of owning their piece of a luxury hotel. Tokenisation completely changes that. Depending on your budget you could spend as much as you’ll spend on lunch this afternoon, or put in your life savings. The options are endless.
Hotels are gaining greater access, too. Access to capital through crowdfunding has become a popular way for businesses to get off the ground through platforms like Kickstarter. Now hotel real estate development can be done similarly by tapping into the entire globe as a potential source.
That’s the beauty of blockchain. It's as simple as a few swipes and a tap on your phone screen. So you want to buy a little bit of that hotel? SWIPE. Or wait, no maybe you’ll do the one in Bali instead!
It can be as simple as playing a game on your phone. Money in and out in seconds. There are no waiting days for banks to process applications. Just smart contracts on the blockchain computing your transaction before you’ve even had a chance to put your phone back in your pocket!
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Shrouded in secrecy no more. The blockchain technology that is used to host tokenised real estate transactions exists on an immutable ledger, which means that every transaction is visible to anyone who wants to see it. The information is open source, making a trustworthy and transparent situation that allows all those involved to be assured of their transactions.
The fun doesn't stop there. The ability to crowd-fund large real estate projects automatically creates the opportunity to build a community through exclusive benefits and shared ownership. This opens up the ability for projects to flourish as ideas get traded and people’s opinions are heard, creating a sense of belonging and well-being for all those involved. The community aspect can be looked at from a different angle too. As Ludwig Bouldoukian from Hyatt points out “When locals become investors in hospitality projects, they feel a deeper connection to the success of these ventures.”
Typically sustainable goals have been pushed through the agenda of the consumers as opposed to producers. These days a large portion of consumers want to know that their hotel stays are going to have a small carbon footprint and this isn’t always so easy for the hospitality industry. Going green can be expensive. So with the tokenisation of hotel real estate development, the opportunity and ability to build and develop sustainably fall into the hands of the consumer. Making pushing the sustainability agenda a more balanced effort for all.
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Still not convinced? You realise that this isn’t just some wild idea right? Nope. In fact, it's been over 10 years since the St. Regis Residence Club Aspen decided to offer digital securities representing equity (tokens) to their community. What happened next? The price grew 32% within the first day and since then the resort has seen trading volumes of over $100k a month unlocking the capital to pursue millions of dollars worth of upgrades which in turn have only pushed the value up. This is only one of many global success stories. Platforms like Azqira are set to open up the marketplace on the tokenisation of hotel real estate, making the future look pretty bright.
