The tokenization firm Fundament upped the ante this week after the company announced that it successfully partnered with one of the most prestigious real estate developers in the country – Bauwens. The maneuver places Fundament at the forefront of the German tokenization sector. Also, it signals a shift from major real estate firms in the area over to a blockchain-based strategy.
Strategic Investor – Fundament
The real estate giant Bauwens is one of the largest development firms in operation across Germany. The firm currently manages billions in investment properties, most notably, the iconic Emporio Tower.
The Emporio Tower is one of the most recognizable buildings in Hamburg. The 98-meter high structure entered service back in 1964. Originally, the building served as the global headquarters for Deutsche Unilever before the firm relocated in 2009. Today the building is a tourist attraction and serves as a luxury hotel.
According to Fundament executives, negotiations started in May. At that time, Bauwens showed interest in the growing tokenization sector. Interestingly, the firm secured a 15 percent stake in Fundament back in September 2019.
An Industry First
Fundament was a prime investment for Bauwens after it became the first firm to gain approval from German regulators – BaFIN. The approval allows Fundament to issue tokenized real estate bonds in a compliant manner.
Managing director, Alexander Jacobi praised the strategic partnership. He took a moment to discuss the important milestone Fundament achieved. He ended his statement after calling Fundaments tokenized bond a “decisive breakthrough” in the market.
Fundament entered the market in 2017. The Berlin-based FinTech firm pioneered tokenization in the region. The company achieved numerous industry firsts since its BaFIN approval. Importantly, the company utilizes the Ethereum blockchain to issue security tokens.
Now, Fundament seeks to expand its platform’s capabilities. The firm announced plans to host a $280 million Initial Bond Offering (IBO). According to company documents, the real estate bond token sale will start on October 8.
The tokenized bonds represent shares in five large construction projects currently underway in the country. The project’s locations make them ideal investments. There are three properties located in Hamburg, one in Frankfurt, and one in the college city of Jen. Notably, Company officials stated that they may consider adding additional properties from Bauwens.
Speaking on the new developments, CEO, Thomas Ermel discussed the nuances of the new partnership. He explained that not all of Bauwens properties are a good fit for tokenization. His firm chose the properties that best suited the strategy.
Ermel also discussed Bauwen's market positioning. He explained that the company has the type of reputation that can entice more investors to the project.
Bauwens Goes Hi-Tech
Bauwens already works with numerous tech firms in the industry with company officials explaining the platform's interest in tokenizing portions of its portfolio via bonds. Now, Fundament and Bauwens are ready to take the German real estate sector to the next level with their latest venture.