Real estate tokenization software platform development: 20 apartments have been tokenized in the first month

Our team has built a custom platform that allows real estate owners and developers to create digital twins of their assets and distribute them among the community so that they can gather profits from real estate entities.

Customer

Industry

Real estate

Region

UAE

Client since

2021

The client provides organizations and individuals with a wide range of services related to real estate.

Detailed information about the client cannot be disclosed under the provisions of the NDA.

Challenge

Real estate assets are very versatile in terms of acquiring and bringing income. Yet, certain assets can be hard to acquire or invest in due to certain regulations and resource-consuming procedures, especially for small investors. Moreover, such events always carry a certain risk of fraud.

Our client has come up with the idea of building a blockchain-based platform that would allow the owners of real estate assets to tokenize property and give access to it to a wide community of investors in a more comfortable, secure, and transparent way.

Solution

Innowise has developed a versatile platform for minting and distributing tokens related to specific real estate assets from scratch.

Profiles

The property owner sends the request for tokenization of real estate assets which is afterwards reviewed by the platform admins (admins can check the property, documents and the legal part of the deal manually offline). Assets are added to the platform from the Admin Panel after the property verification process is completed.

For each asset, a separate ERC20 token contract with its own total supply is generated. The token can be purchased at the market price (the floor price is determined by the oracles from external resources) using the Metamask wallet connected to the platform.

Soul bound NFTs

All the widely known KYC and authorization designs cannot provide the needed level of security since the smart contract is stored and working separately from the rest of the product and users can interact with it directly bypassing the authentication process. With Soul Bound NFTs integrated, the smart contract firstly seeks for the authentication token on the user’s wallet and responds to their calls exclusively if such asset is present.

In terms of compliance, any person (either a property owner or a property investor) must pass the KYC verification process, after which the platform mints SBT (Soul Bound NFT Token) to the user wallet. This way our client can also add restrictions for transferring tokens if the target wallet address doesn’t have a specific SBT token.

Marketplace

The Marketplace tab features the primary and secondary sections. The primary marketplace allows users to invest in or resell newly-developed real estate assets.

The secondary marketplace allows users to trade already owned assets. For example, a user can purchase one token representing 10% of a three-storey mansion during the primary sales and then acquire the rest 90% on the secondary market and be the only possessor of this property.

Revenue distribution

Once investors acquire tokenized property, they begin earning income from their possessions.

The revenue is distributed using a separate Solidity smart contract that automatically spreads the income generated by the assets among token holders (or can be claimed manually at any point of time for gas fees). The smart contract is designed to distribute revenue on a regular basis, such as monthly or quarterly, and takes into account factors such as the number of tokens held by each individual and the total revenue generated. The revenue distribution is done using a predefined formula which is encoded in the smart contract to make it transparent and fair for all the token holders. Also the smart contract can be connected to external DEXes and automatically swap cryptocurrencies if needed.

The secondary market is based on a separate smart contract which leverages the possibilities of off-chain signatures (EIP-712) to avoid unnecessary gas fees during negotiations between property investors (off-chain signatures are stored on the back-end side and are validated by the smart contract).

Technologies

Back-end

NodeJS, NestJS, Rest, Websockets, GraphQL

Front-end

Flutter, Flutter Web, Dart, Clean Architecture, BLoC, Flutter Async, Rx Dart, GetIt, AutoRoute, Dio, Multi Modules, linter

Blockchain

Solidity, OpenZeppelin, HardHat, Ethers, Mocha, Chai

Database

MongoDB

Platforms

Web, Mobile

Process

The client had a clear vision of how the application should work but needed assistance in understanding how to create it.

As far as the development process is concerned, we resolved all issues:

created the design of the platform and its architecture;
suggested ideas on the platform’s functionality and their implementation;
created and deployed the product with the required functionality.

Based on the client’s requirements for the development process, we chose Agile as the software development methodology with daily meetings and bi-weekly sprint reviews.

Our team communicated with the client via Slack and held daily team meetings and bi-weekly sprint reviews in Google Meet. Project documentation was stored in Confluence, and we tracked task progress in Jira.

As a result, we have created a fully working product that allows tokenizing physical real estate into digital assets and gaining investors’ attention and funds securely, comfortably, and transparently.

Team

Back-End Developer

Flutter Developers

Blockchain Developer

Business Analyst

UI/UX Designer

Project Manager

QA Engineer

Results

As a result, Innowise has developed an easy to use, secure, and transparent blockchain-based platform that allows real estate developers to tokenize their assets and bring investments from a wide variety of organizations and individuals. Also, the platform allows utilizing tokens for revenue gain and re-selling on the secondary market.

Project duration

3 months for product launch including

1st day — idea
1st month — proof of concept and gathered requirements
2nd month — functional MVP launch
3rd month — stabilizing and improving the solution

FAQ

What is the real estate tokenization platform?

It is a digital platform that uses blockchain to divide real estate assets into digital tokens. These tokens represent ownership shares and can be bought, sold, and traded.

How does the real estate tokenization platform work?

A tokenization platform utilizes blockchain technology to tokenize real estate assets. It involves the conversion of ownership rights into digital tokens, which are then securely recorded on the blockchain. These tokens represent shares of real estate properties, allowing for easy trading and investment.

What are the benefits of using the real estate tokenization platform?

A property tokenization platform offers various benefits, including increased liquidity, reduced entry barriers for investors, simplified and cheaper transactions, enhanced transparency, and impeccable security of shares. It revolutionizes the real estate market by providing new avenues for investing and unlocking asset liquidity.

How does real estate tokenization impact investors and property owners?

The fractional ownership feature opens up new possibilities for investors by reducing investment entry barriers for those with little budget. It allows investors to easily manage their portfolio using a secure and transparent platform, and easily invest their resources in desired assets. Property owners benefit from increased liquidity, higher income, and efficient property management thanks to a wider pool of investors who have the will and possibilities to gain access to the assets.

Is the real estate tokenization platform secure and legally compliant?

Yes, the tokenization platforms we develop prioritize security and compliance. They employ robust blockchain technology and encryption mechanisms and follow legal requirements by using SoulBound NFTs and KYC procedures to ensure investor identity.

Can the real estate tokenization platform be customized for specific real estate projects?

Yes, property tokenization platforms can be customized to meet the specific requirements of property projects. Innowise works closely with clients to understand their needs and develops personalized solutions for efficiently tokenizing and managing their assets.

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