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Property platform taps interest for digital payment

dubai - Investors can use digital currency to buy a token and benefit from proceeds of a property portfolio

Imagine if you could buy and sell a real estate asset at the click of a button? This could soon be possible courtesy Evareium, an entity which is launching a $90 million Dubai-focused real estate investment fund where investors can use digital currency to get tokens. Up to 150 million tokens are available. The money raised will be used to purchase property assets. The tokens give investors a right to the net proceeds distributed from the fund.

Evareium is crowdfunding direct investments in real estate in Dubai and the UAE. EVM investors will not have to endure the issues of physically buying, selling and maintaining property investments themselves. Investors have the opportunity to own a stake in a property portfolio via a token distributed via blockchain technology. EVM Blockchain Limited of the Cayman Island is the issuer of EVM tokens.

Evareium is a platform for the savvy, click-in-click-out digital age investor. The entity also aims to open up Dubai real estate to more institutional investors. Only 20 per cent of GCC real estate is currently institutionally owned compared to 70 per cent in developed markets.

"We are in the process of ITO in the Cayman Islands. We have been speaking to the private investment community. Our mission is to digitalise real estate investment. It is a very illiquid asset class, yet very popular globally. It's hard to get in and out of real estate. You can lower the entry point for people looking to invest. One could get an asset-backed real estate investment by clicking a button and coming in at a lower entry point," says Stefan Hickmott, founder and CEO, Evareium.

Evareium has created 150 million EVM tokens ($1 each par value) with the aim of raising at least $90 million in equity to invest in real estate assets. It is looking to raise $20 million initially to buy its first asset.

Investors accrue benefits from capital gains generated from the acquired portfolio, rental yields and gains on the eventual disposal.

"There is an opportunity to be able to institutionalise the sector in Dubai and the rest of the GCC. Institutional capital is underrepresented here as compared to global cities such as Singapore, Hong Kong, etc. With our model being able to buy whole buildings, do very short gestation periods of value-add to improve real estate and finally migrate those assets to real estate investment trusts [Reits], it will help create more liquidity. This will help all stakeholders in a real estate economy," adds Hickmott.

Evareium has secured the rights to acquire its first $20 million real estate portfolio in Dubai. The portfolio comprises complete buildings totalling almost 700 apartments across two new up-and-coming master communities in Dubai involving asset-managed units.

"We don't go into conceptual projects. We would do some very short gestation period developments, say a 100 townhouses, with all the approvals in place. Evareium would target low to medium risk as an investment but the returns would far outweigh the risks. Commercial, retail and industrial tend to be stronger asset classes because of longevity of contracts," the CEO points out.

Safa Capital, a DFSA-regulated institution, is the lead arranger of the Evareium fund for professional investors. "We only accept professional investors whose net assets are worth over $1 million. Real investors who don't have an affinity for cryptocurrencies can also invest in dollars in our fund," says Faheem Aziz, CEO, Safa Capital.

Evareium will institutionalise real estate assets and hand them over to Reits, which it intends to establish regionally in the future. This will bring a steady flow of investment grade assets to the market.

"The Evareium fund can attract a bigger pool of both the traditional, long-term investors as well as small investors who have the ability to exit through exchanges," concludes Aziz.

- deepthi@khaleejtimes.com