Democratic Investing with Fraxtor
Another company is looking to make their mark on the digital securities sector, as they ramp up operations surrounding their real-estate investment platform.
Naturally, as these types of investments represent ownership in an underlying asset, with an expected positive return over time, the Singaporean government views them as securities. What this means is that participation is restricted to accredited investors only, at this time.
Fraxtor notes a distinction in what separates their projects apart from others. Specifically, the vast majority of real estate based investment opportunities are restricted to developed properties. While these may represent great investments, the ability to gain exposure to such an asset on the ground floor typically proves to be more lucrative in the long run.
The issue with this, however, is that the amount of funds needed to invest in yet-to-be-developed properties is financially prohibitive. The result is that these opportunities are typically restricted to large property developers, not retail investors.
Fraxtor saw this, not as a problem, but as an opportunity to leverage the capabilities of digital securities, bringing the masses access to such investments; essentially democratizing real estate investing.
Representatives from each, Proptech and Fraxtor, took the time to elaborate on the need for their solutions, and how they will work.
Oliver Siah, CEO of Fraxtor, states,
“Investing in premium real estate is often out of reach for the average investor as it requires high capital outlay and is very illiquid. This makes property investment riskier for investors as they are not able to effectively diversify their portfolio. REITs, on the other hand, do not provide the returns that Private Equity Real Estate Funds can achieve. With Fraxtor, I hope to be able to democratize real estate investment…We have placed a digital wrapper around a physical asset which allows us to issued digital securities to our global investors so that they are able to participate in that particular investment.”
Jordan Kostelac, Director of Proptech, states,
“Now everyday investors like you and me can actually own a piece of grade A office tower in the biggest cities in the world. From an asset holder standpoint, it creates new sources of liquidity and allows them to improve that asset or creating yields from that asset by dividing up the ownership. In the same way as companies do in public offering of their equity.”
To date, Singapore has established themselves as one of the leading countries, with regards to acceptance of digital securities. Not only does the Monetary Authority of Singapore (MAS) host a FinTech Sandbox, they have been quite forward thinking with their endorsements towards companies such as iSTOX. Check out the following articles to learn a bit more about a few Singaporean based endeavours.
Operating out of Singapore, Fraxtor was founded in 2017. This young company specializes in bringing real estate based investments to the masses, through the use of blockchain based technologies.
CEO, Oliver Siah, currently oversees company operations.