Thai property developer to sell fraction of condos by issuing digital tokens
A leading real estate developer, in collaboration with a digital asset investment firm and and an initial coin offering portal, is exploring asset fractionalisation by launching Thailand's first digital token for luxury properties, with the goal of diversifying options for Thai retail investors.
Peerapong Jaroon-ek, chief executive officer of Origin Property, said at a press conference on Thursday that the issuance of digital token "RealX" for investment is aimed at making 361 units of three condo buildings — Park Origin Phrom Phong, Park Origin Phayathai, and Park Origin Thonglor — available as smaller investment units via tokenisation technology.
Digital asset investment firm Real Estate Exponential and TokenX, an initial coin offering portal that offers end-to-end tokenisation services, are partnering Origin Property in this venture.
Peerapong explained that this type of asset fractionalisation, made possible by current financial technology, was created to alleviate the pain points of the new generation and the general public who are interested in investing in the property sector.
He noted that the digital asset form enabled small investors to invest in expensive assets such as real estate. One RealX digital token will be equivalent to investing in a condo area of about 1 square inch.
It may not be the best way to own a luxurious condominium as buyers cannot move into it, but it is a long-term valuable option in the property investment cycle, Peerapong said.
"We want to offer condo investment innovations. Condos in the heart of the city are considered assets with opportunities to add value in the future due to limited supply and difficulty in finding land for new development. With the full reopening of the country and the gradual recovery of the economy, I believe the demand for condo rentals in central locations will be on the rising trend," he said.
Veraphong Chutipat, CEO of Real Estate Exponential, said that in the past, property investment was only available to the wealthy. Retail investors, however, can now gain access to this industry thanks to blockchain technology and tokenisation.
He emphasised that the RealX token is different from other cryptocurrencies as the token is backed by real luxurious condominium assets.
Jittinun Chatsiharach, CEO of Token X, said RealX was in the regulatory process with Thailand's Securities and Exchange Commission.
The first public initial coin offering is expected in June, with no more than 19,230,769 tokens at a price of 182 baht per token and a total value of no more than 3.5 billion baht, she said.
She explained that the funds would be invested in the Revenue Sale and Transfer Agreement contract, which will generate income from the project's assets for transaction expenses, loan payment from fundraising, and use as working capital of digital token issuers.
According to Peerapong, investment in Real X has a project life of 10 years from the start date of the project.
Holders of digital tokens will receive two types of returns: (1) a quarterly return on the net rental of the condo during the first five years, and (2) a chance to receive 10-25% of the condo price difference that is expected to increase after the sixth year of investment.
Retail investors cannot buy more than 300,000 baht per person in "RealX" digital tokens.