The Caribbean continues to see more crypto development. This month, the real estate investment firm, La Estancia Holdings announced plans to be the first real estate backed STO in the region. The announcement showcases the growing tokenization of the real estate market, as well as, the rising number of blockchain specialist in the Caribbean.
One of the Largest STOs in the Region
La Estancia Holdings seeks to raise $75 million in funding to further the company's holdings in the Dominican Republic. Currently, the firm manages a variety of villas, townhouses, and cottages via the La Estancia Golf Resort located in La Romana. The company also manages an additional 123 residential properties across the island.
Discussing the project, La Estancia Holdings EVP, Laurent F. Chemla explained how blockchain technology breaks down traditional investment barriers. Chemla took a moment to touch on some of the most worth-while advantages of blockchain tech.
Transparency was the first point mention. This is valid when you consider that property ownership disputes are now common in many places of the world. Tokenized real estate has an immutable record of transactions covering the course of the property's life. In this manner, blockchain systems are a more secure alternative.
Multiple governments recently started blockchain-based land registry programs. For example, Titon County, Wyoming signed a Memorandum of Understanding with Overstock’s blockchain land governance subsidiary – Medici Land Governance (MLG). As part of the program, Medici will transfer all of the county’s property record to the blockchain dating back to 1996.
Chemla also spoke on fractional ownership. Fractional ownership allows you to better diversify your investment capital across multiple properties. Blockchain technology allows nearly anything to be tokenized and then sold in microtransactions. These transactions allow for larger investor participation.
Traditionally, major crowdfunding campaigns restricted participation to only accredited investors due to the cost of monitoring and managing these investments. Blockchain technology automates this workload and enables a worldwide audience to participate without adding additional costs to the campaign.
La Estancia Digital Security Token (LAEST)
La Estancia Holdings seeks to provide investors with fractional ownership of a basket of Caribbean real estate via its STO. Each LAEST equals a share in La Estancia Holdings, LTD according to the company’s homepage. As such, token holders are entitled to applicable commercial rental dividends. Additionally, investors receive a percentage of any properties sold from the firm's portfolio.
DR Tourism Boom
Chemla also pointed to the tourism boom the Dominican Republic has experienced over the last five years as another strong consideration for investors. According to one report, the DR achieved record-breaking tourism numbers in 2018. Consequently, if this trend continues, DR real estate prices could continue to rise significantly.
La Estancia Holdings
La Estancia Holding definitely deserves the recent uptick in media coverage for its advantageous strategy. The Caribbean is home to many well-known crypto investors, and new projects are always entering the space. For now, La Estancia Holdings is a pioneer in the Caribbean real estate market.