Real Estates and the Blockchain: The Next Investment Frontier
The fourth industrial revolution has finally found the catalyst to spur on its growth, the Blockchain. The blockchains ushering of revolutionary mediums for securely and transparently exchanging values with no middlemen has been nothing short of a game changer across all industries. Investors from all over the world are now being afforded real-time investment opportunities through hassle-free, decentralized platforms. Industries whose accessibility have, hitherto, been mired in opacity and potentials stymied by soteric accounting have finally found the perfect vehicle for manifesting their true worth. One such industry is the distressed asset.
Following the financial crash of 2008/2009, the post-recession recovery rate of EU countries continues to be at odds with each other especially Non-Performing Loans (NPLs) backed by real estate collateral. This movement is strongly present in SEE region, as there are the highest balance NPLs since the economic crisis. The crash, brought on by NPLs and overvalued properties (basically, folks couldnt afford to pay their mortgages), has long since gone down in history as the biggest financial meltdown the world has ever seen, yet its spectre continues to haunt the real estate industry.
When you take a loan from a bank, the bank expects the loan to yield interest and be repaid under specific conditions. This is a performing loan. However, when the customer cannot fulfil the agreed repayment plan after 90 days or more, the bank now has to set aside capital on the assumption that the loan may not be repaid, drastically impacting its capacity to facilitate new loans. At this stage, the loan is now a Non-Performing Loan.
To remain profitable, banks must keep their NPLs at a bare minimum and in some cases, are prepared to sell high-collaterals to clean up NPLs and inject capital into their operations. Herein lies the opportunity that sets Elements Estates apart from all other real-estate-on-the-blockchain platforms.
Tokenizing Real Estate Opportunities
A decade after the financial crisis of 2008, the world is yet to fully recover from the impact. Millions of assets are still tied up in NPLs and there is now an increased urgency from banks to clean up their books, often at undervalued prices.
South-East Europe (SEE) is one of the most fertile landscapes for distressed assets. The region is regarded as possessing the highest mid-term potential from distressed deals within the EU with an average annual gross domestic product (GDP) growth of 2.3% despite being saddled with around 130 billion euros in non-performing loans.
Having spent decades in the industry, Elements Estates team is not only developing a decentralized investment platform for distressed assets, but an altogether revolutionary ecosystem for the redevelopment of distress properties, selling, and renting to both token holders and the general public. The highly-experienced team with proven track-record will set-up a private corporate fund to be used for the purchase, development, and maintenance of real estate projects across the regions.
Governed by autonomous smart contracts, Elements Estates is unlocking real estate opportunities in distress market through its native ELES tokens. Unlike other platforms, Elements Estates is focused on a very specific market and very specific conditions a market it completely understands and profitable conditions. The platforms innovative fund mechanism will constantly keep checking available residential and commercial properties against market conditions for token holders benefits.
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