Tokenisation (RWA)
Tokenised real estate
Property is tokenisation's most evocative story: split a building into thousands of pieces so anyone can co-own from a hundred euros. The technology allows it, but practice has stubborn limits. Below we describe the structure honestly, including the parts sales material tends to omit.
What the structure really looks like
You almost never buy part of the building itself. Usually a company is set up to own the property, and shares or bonds of that company are tokenised. You become a shareholder or creditor of a property company with a claim on rental income after costs.
The land registry still governs ownership of the building; the blockchain only records who holds which slice of the company. That is not a flaw but the legal reality in most European countries, and it explains why a notary or administrator remains essential to the structure.
- You buy shares or debt of a property company
- The land registry still governs the building itself
- Management, insurance and maintenance run through that company
Yield and the costs that eat it
Returns come from rent and any gain on sale. Out of that come management, maintenance, insurance, vacancy, corporate tax and the platform's fee. A six percent gross rental yield can easily land at three to four percent net.
Always ask for the net yield after every layer, and for historical vacancy. Check whether the platform earns a fee on purchase, on management and on sale; that stacking shapes your return more than the rent does.
- Work with net yield after all costs and tax
- Ask for vacancy figures and maintenance reserves
- Watch stacked fees on purchase, management and sale
The liquidity promise, examined
The strongest sales argument is that you can sell your tokens at any moment. Technically true, but a buyer must exist. Secondary markets for property tokens are thin; sales often happen at a discount to the last reported value, and sometimes not at all for months.
The issuer usually sets the valuation too, based on an appraisal revised once or twice a year, so the value responds slowly to the market. Treat a property token as a multi-year investment, not as something you can readily turn into cash.
What to check before you commit
Treat the offer as a prospectus, not an app. Check for an approved information document, who holds the licence, where the company is domiciled and which court has jurisdiction in a dispute. Ask what happens if the platform ceases to exist: does the company and its management continue?
For Belgian and Dutch investors the tax treatment matters too. A share in a foreign property company is treated differently from a bond or from direct ownership, and withholding tax on rental income can cut the net return further. Settle that beforehand, not at filing time.
- Is there an approved prospectus or information document?
- What happens to the property if the platform fails?
- Which withholding tax and which supervisor apply?
Frequently asked questions
Do I co-own the building?
Usually not directly. You hold shares or bonds of the company that owns it; the land registry names that company, not you.
Can I sell quickly?
Only if a buyer exists. Secondary markets are thin and sales often occur at a discount; plan for a horizon of several years.
Is this better than a property ETF?
It is different. A listed property fund is daily liquid and diversified but moves with the stock market. A token gives exposure to one building or portfolio, with higher costs and far less liquidity.
Read next
What is tokenisation (RWA)?
Tokenisation turns bonds, funds and property into tokens on a blockchain. How it works, what changes legally and where the real risks sit.
Tokenised bonds and funds
Government bonds and money market funds are tokenisation's first real use case. How yield, custody, settlement and risk work in practice.