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How RedSwan CRE Is Using Tokenization to Improve the Commercial Real Estate Marketplace

Real estate has always been and continues to remain a classic form of investment. No matter what state stocks are in or how attractive bonds may be, investors will always gravitate toward real estate.

Why? Because real estate is predictable. It may not always have the same explosive growth as has been seen in the last couple of years thanks to the sellers’ market created by the pandemic. But even in slow times, real estate holds its value and can even generate passive income – if investors are savvy enough to tap into that potential.

The problem is that real estate investing typically takes a lot of head knowledge, gut instinct, and overall experience. It also requires quite a bit of capital – especially for those looking to increase sizable profits from pricier commercial real estate transactions.

The team behind RedSwan noticed this discrepancy in investor resources and decided to do something about it. The results are shaking the markets and challenging real estate investing as we know it.

RedSwan and the Tokenized Real Estate Marketplace

RedSwan CRE is a fin-tech company that is rewriting the commercial real estate (CRE) script. The brand is skipping right past major financiers – who collectively have a stranglehold grip on the commercial real estate industry – and going straight to smaller investors. With recent worries about confidence in crypto investments, it’s a more stable option for investors.

The goal is to, in effect, crowdsource the resources of this underserved group of non-institutional investors. When brought together, their cumulative might gives them the ability to penetrate the cutthroat commercial real estate market.

The primary way that RedSwan is accomplishing this goal is through tokenized real estate.

RedSwan Gives Investors the Ability to Invest

Tokenization is a simple concept. All it does is convert an asset – or more specifically, the ownership rights of that item – into purely digital representations of the original asset.

To put it another way, it takes something like the ownership of a piece of commercial real estate and turns it into a digital security token.

Why does this matter? Because, unlike a building or even the deed to a building, you can easily divide a digitized token. In the case of RedSwan, that means the company can allow individual investors to purchase fractionalized pieces of a tokenized property.

It’s the same as using $200 to purchase a portion of a Bitcoin or buying a single share of Apple stock for a similar price point.

This ability to tokenize real estate dramatically lowers the barrier of entry in an industry that historically operates with one of the highest entry points of them all. Offices.net puts the average price of commercial real estate in the U.S. at $35 per square foot. But, of course, you aren’t purchasing a single-family residence. Commercial spaces are enormous, and many of the best options often go for over $20 million – with 20% often required as a down payment.

By creating tokenized CRE investment options, RedSwan allows investors to purchase part of a piece of commercial real estate for as little as the company’s minimum investment of $1,000. In addition to being affordable and accessible, tokenization also makes commercial real estate easier to liquidate and reduces transaction costs, too.

RedSwan Provides Educated Support for Investors

Of course, just because commercial real estate is accessible and affordable via tokenization doesn’t mean anyone can walk up to the bank (or more accurately, log onto their banking portal) and buy part of a piece of real estate right there on the spot. Making that kind of purchase, especially in a commercial setting, requires an incredible amount of knowledge. There are countless steps, and it can turn into an overwhelming process for anyone who lacks experience.

That’s why, along with tokenizing the commercial real estate process, RedSwan plays the role of a central ecosystem within which purchases can take place. The company brings investors and property owners together on a single platform where the latter can purchase tokenized properties managed by project sponsors.

This enormous simplification of the commercial real estate purchase process allows individual investors to skip the need to understand each and every step of the buying process. They avoid navigating the red tape of CRE investing and are able to sit back and watch their money put to good use with minimal effort or risk.

As a final flourish, RedSwan investors aren’t restricted to cash investments. They can use real estate to stabilize cryptocurrency portfolios, which are quickly becoming notorious for their instability, as well.

For those facing the issue of cashing out of crypto into fiat currencies that are riddled with inflation concerns, RedSwan offers an attractive alternative. By purchasing fractionalized real estate shares through a tokenized CRE broker like RedSwan, you can turn uncertain crypto gains into solid, dependable real estate investments.

The concept of tokenization – especially digital tokenization – is still in its infancy. Even so, innovative companies like RedSwan can see the near-unlimited potential that this new fintech capability possesses. It will be fascinating to watch as the foresighted startup continues to build a base of everyman investors that are able to disrupt the commercial real estate industry for the better.


Photo by Paul Hanaoka on Unsplash

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