Topic: Own a piece of Manhattan (Read 402 times)

Its the same thing, in the end your looking to rent for BTC , correct ? then all it depends on finding whos willing rent for BTC . same as finding whos willing to sell for BTC. but since your looking for partnership, its better converting your BTC to cash to buy with your partner whatever building is going to be and converting rent to BTC to split profit. much easier and ownership can be split between partners. You can even draft the contract through crypto payment.

Are there any more oppurtunities like this active?

Ah, right. My mistake.

So you're looking at this more from a liquidity angle.

This isn't something we are trying to achieve. This is just accepting BTC as mode of payment instead of local currency. At the end of the day, owner will still be a single individual/firm with all the cash. The idea with us is to tokenize a property. Regulatory framework makes it hard to do so without setting up intermediary investment vehicles.

Oh man, my first investment and the best! helped me a lot in my start and still doing whenever I come a cross a good deal. happens all the time there, I can confirm. I am an Egyptian lawyer, drafted many contracts between partners vs real estate and construction companies. Basically, 2-4 partners collect specific amount together to buy a land or old house. Take it down and partner up with a real estate construction company to build a big building and do the rest so they do not get bothered with workers. 10-13 floors each floor with 2-4 flats depends on area budget to sell the apartments fast and split profit 60/40 between land owners and construction company. 150-200% profit back even before the building is over and finished because many buyers prefer to deposit 50-70% and pay the rest monthly for one year max which what it takes for the building to be finished and when its finished they just move there to live in their new apartments.

Very good business though, and better than US & EU since laws much easier not strict. I live in Sweden now and I though about doing it here but kinda hard with all the laws and regulations must own a big land and build many houses not big building with flats unless the government is the one building or special contracts to special companies , etc so in the end kinda like a monopoly. hard for small-medium investors to get in.

But in middle east much easier

OP was in February.

Is there any update? I think I read about an entire building in somewhere in the Middle East being made into apartments, which were then auctioned off in exchange for BTC. Update, found a link to the story: https://www.telegraph.co.uk/property/buy/bra-tycoon-michelle-mone-selling-192m-dubai-apartments-bitcoin/

Can the above be relevant to your pursuit?

I am thinking of a private placement only via a coin. As long as there is no ICO, we may not need for SEC registration. It would be a token similar to REITs.

Glad to observe the interest in this.

Really interesting idea. From experience the legal side of it would be a nightmare, but there are intermediate companies that would oversee and run the property. It would just come down to if it the size of investment and potential return of said property over a fix period.

I would be interested to hear more.

Well I am not interested in COOPs at all. They are a pain in @$$ to deal with and like you said, are not investor friendly.

What I have done is identified smaller sub-pockets of the neighborhood. These pockets have good quality condos and are close to either subway stations/university/major corporations. This makes them ideal for renting out.

And yes, this would require a buffer capital to allow maintenance costs while looking for tenants.

The challenge is how to work on the ownership model. A legal entity in US will own the real estate. But how to translate that into fractional ownership via crypto?

New/old doesn't matter as long as it works and makes money. Isnt it?

The current scheme of things allow local investors to pool and invest. But with cryptos you can remove the boundaries and can also have a proven chain of custody. So I believe there are benefits.

interested

I like this idea very much....and wonder what the minimum investment would be to get on board.

    Manhattan real estate prices are always increasing in price.

   Having been a resident in NYC I have one word of advice to give you when buying an apartment for investment purposes or for only renting it out.

   BUY A CONDO!

    Buying a condo you will be able to rent for all the time you want with no hassle from the board.
   
   They have the right of first refusal, in other words, if they say NO they will have to pay the asking rent amount. Its a win win situation

   IF you buy a COOP you will be denied and you have to eat it.
 
   COOP is cheaper than CONDO.

    Also most COOPs will refuse your right to purchase as they are no investor friendly!

   Condos are more expensive than COOPs, but worth it!

   Make sure the real estate property the building is sitting on is owned by the building and not being leased from another land owner!

   Make sure the financials are solid, in other words...a nice large reserve exists and you are not bleeding money because of poor money management!

   Not only will you make money thru renting the apartment but you will also have the apartments value increase over time, and that in itself will increase  over time!

It is not a brand new idea, but it is a practical idea.

and more important, this idea can be realized without cryptocurrency

Yes I have been working on it. But looking at the complex tax laws associated with owning a property, it is pretty much a nightmare. Physical assets such as an apartment need a real world owner. The person/entity responsible for paying real estate taxes, interests etc. I have some ideas on how to execute it - but then any such token borders on SEC definition of an equity sale. Its kinda catch 22 situation.

Anything with different idea even is the key to success provided obviously if the team is right and directed with the right vision. With the block chain world will change and so things around this will work best.

Sounds interesting, like a Co-Op with tokenization. If done right, the sky is the limit. Are you really planning on pushing this through?

Well that's the thing. If we go by regular property ownership title and deeds process, it will be challenging. But what if there is a coin that represents fractional ownership in 5 such properties. Each token represents some percentage of a property held only as investment by a real world entity. The gap is in the paperwork involved and that is where blockchain solution needs to be created.

This is definitely something I'd be interested in, however the paperwork would be extremely difficult, particularly if the investors all live in difference countries. There are websites that offer similar services, e.g. Propertymoose, and a few other crowdfunded rental sites, and they don't achieve 100% occupancy despite being experts.

Although in theory this is a good idea, practically it's unlikely to come through.

There is a major difference between a Loan and an Equity investment. The interest rate charged on loan is priced in after the value of collateral, the credit worthiness of the borrower and term of the loan is taken into account. There is a FIXED expected return with no/minimal variance except in case of a default.

On the other hand an equity investment is an investment at risk. No collateral is posted for an equity investment and any profits generated are distributed via dividends. When someone invests in an ICO or IPO there are no guarantees on what the return might be. The only so-called assurances are of the project being undertaken or the product being developed. If you were to invest in Google 10 years ago, what sort of collateral would have justified your investment? Answer: Nothing at all. You would have invested with the team running the show and the idea behind it. It would have been an AT RISK investment. 

The only investor protection I believe that is to be offered in my case is protection against fraud by the Trust so to say. Otherwise, it would be an investment with associated risks.

Yes the poster most certainly-- even if not explicitly-- alluded to protection against being defrauded and scammed. Not being sure what he was alluding to implies you may not have considered that particular risk for those who join this crowd funding initiative. Investing with a view to achieving some form of ROI is akin to providing a loan with the loan's interest taking the analogous role of an ROI. Loans here are almost always the secured and collateralized form of lending. An invitation to invest in or crowdsource funds for a property purchase is essentially asking for money for that purchase. Without some kind of protection for the investor, you would be inviting them to gamble.

So yes, several posters above mentioned legal protection of investors. I very much agree to having such an arrangement established, given the kind of amount needed for buying property in Manhattan. That protection is usually established in the form of valid collateral. Pure uncollateralized investments are rare, given the risks. I'm not sure how fractional property ownership works in terms of, say, one investor opting to liquidate his share in the investment. This might be complicated and will require contracts drawn up by a real estate lawyer.

So let's look at the risks associated with the investment and then risks in the plan.

Risk with investment: You are buying an apartment in a nice neighborhood. All risks associated with such an investment remain : Market crash in real estate prices, natural disasters etc. An insurance cover can be bought to compensate such risks.

Risk with Plan: The biggest risk with this project is non-occupancy of the apartment. What if the apartment is not rented for 12 months or more? And honestly I'd be lieing if I say I can guarantee a rental. All I can say is that I have lived in this neighborhood for 5+ years and have successfully found roommates/tenants. It WILL require work, but should generate rent with comfortable probability.

The risk is with generating rental income. However, your initial investment into the real estate remains intact. Even if the property returns no rental income, your equity in the apartment stays intact.

As for legal protection of investors, I have to dig in more. Any ideas would be appreciated.

Ideally, I would like to tokenize each investment. Or at least have a global token for all investments combined. But start up costs to set up an ICO and Development of smart contracts is pretty high. Perhaps, for the first deal it has to be more on traditional offline mode. It highly depends on the interest that I receive in this. I have started hitting bitcoin meetups in NYC area and hopefully I will be able to get more traction on this.

In the end, the idea will be to facilitate liquidity in such fractional ownerships of apartments - so that people can trade in/out of the deals.

As for legal protection, I am not sure what are you alluding to? If you mean to imply protection against scam, then I can say that this will be done via a legitimate business established in the USA etc. All details about the target apartment will be available for someone to verify where the money is going.

Share allocation is just a normal thing into these kind of ventures.I would like to know about on that legal protection of investors.I do love the idea since we do see an opportunity on making out money but the question here is that theres lots of things to be considered first specially on convincing people on funding you in. The question is how can you prove and make an assurance that everything would go to the plan?

Very interesting idea, do you plan to use tokens for that? It would be good idea to have some sort of shares equivalent to investment someone took. Have you been thinking about some legal protection of investors too?

Hello all,

I was wondering if there would be interest from the community to crowd funding an apartment that can potentially generate rental income?

I live in a neighborhood in New York that hosts several professionals in the age group of 25-40. There are high rise buildings here with plenty of apartments. The apartments barely stay vacant and I myself have sub-let my apartment several times over last few years.

I have a vague idea wherein I can crowdsource an apartment purchase in the neighborhood and then manage it for rentals. Since there would be no mortgage involved, the monthly costs would be minimal(building management fee). Any rent generated can be redistributed, while the ownership still remains with us.

Thoughts?