January 2nd, 2024
Discover why Coreestate, a Danish real estate developer, chose DigiShares’ white-label technology to tokenize a residential real estate asset in Vejle, Denmark. Read the interview with Kristaps Cuders, Co-Founder and CEO at Core estate and gain invaluable insights into their tokenization journey.
About Coreestate and their business
“Coreestate operates in real estate tokenization industry. Our first project is live from July 2023, however, the company was founded at the end of 2021. Coreestate is acquiring old buildings that can be renovated and further raising capital through tokenization for the renovation of the buildings. We offer investors an opportunity to invest in tokens that are backed by real-world real estate and to earn passive income from tenant rental payments.
Our business model consists of identifying investment properties, negotiating the purchase with the owner, planning engineering, architectural, construction, and financial aspects of the project, acquiring necessary permits from the municipality, issuing tokens backed by the property, raising capital for renovation, renovating the building, finding tenants, renting the property, and maintaining it.”
“We see tokenization as an alternative way of raising capital for renovation projects. Tokenization allows us to be independent of bank loans and allows us to offer attractive investment opportunities for the broader public. Tokenization will also allow tenants to be responsible only for maintenance fees and interest payments, instead of hefty down payment and monthly mortgage fees. With the help of blockchain technology, we can disrupt the market and make real estate affordable, accessible, and tradable.”
Which property is being tokenized?
“GREV 55 – the property is located in the Danish city, Vejle. It has a unique location on the top of the hill close to Vejle city center. It has a private driveway and parking for residents. The area around the building is rich with beautiful nature while located right by the city center. GREV55 property comprises stand-alone three storey building which has total gross area of 396m2. The land plot that belongs to the building is 918m2, which will allow residents to have plenty of outside area located close to the house. Originally, the building was built in 1912, it has undergone multiple modernizations, however, at the moment it needs to be renovated to meet modern standards.
The renovation process consists of rebuilding 3 apartment buildings into 5 modern and energy efficient apartments ensuring that future tenants have a pleasant, attractive and cost efficient house to live in. During the renovation process it is planned to renovate the facade by thermo isolating it, replace windows, doors, electrical installations, plumbing, heating systems and refurbish interior.
We estimate that the building’s market value after renovation will be 2 million € and yearly rent collected will be 70,000€. It serves as a great investment property in one of the most stable real estate markets – Denmark.”
Why DigiShares was the perfect choice for Coreestate?
“DigiShares’ white-label tokenization platform has enabled us to enter the real estate market and offer our fractionalized assets, even without prior experience as a real estate developer, software developer, or financial service provider. Since collaborating with DigiShares, we have become part of a supportive community, where everyone works together to foster growth and achieve their goals.”
The seamless integration between DigiShares and Corestate
“Tokenization allows us to change the ownership of the property to the masses and not one individual or company. Tokenization made capital raising more effective, allowing us to manage shares and fractionalize offerings without having manual processes.
We see that tokenization will be at the core of our business operations, by allowing us to raise capital for different real estate investment projects.”
Which Blockchain are you using and why was it selected?
“Ethereum – it is the most widely used blockchain in the tokenization space and serves as a stable and secure network for security tokens.”
In which countries are you targeting investors?
“As we are a Danish firm, our target market is the European Union. However, we see Danish, Norwegian, and Dutch investors as our primary target users.”
Are you targeting retail, professional or institutional investors or all three?
“We are targeting all three, for properties of high value it may be difficult to raise capital from retail investors only, however, we are working on some exciting updates that will make the investment experience very simple for investors, thereby allowing retail investors without experience to buy tokens in an easy and simple manner.”
Are you considering listing your assets on an exchange? Which exchange?
“Yes, certainly, we want to list our assets on a secondary exchange, thereby increasing the liquidity of our tokens and making our investment offerings more attractive.
We plan to launch on REX, RealEstate.Exchange by DigiShares.”
What is the minimum investment amount for investors?
100€ minimum investment.
DigiShares provides white-label solutions for the issuance, corporate management and trading of digital assets. With offices in Denmark, the US and Germany, DigiShares is a global provider of tokenization software for investment management, corporate management, and trading of tokenized securities. DigiShares has around 150 clients globally using its software.
Coreestate: Pioneering Sustainable Real Estate with Blockchain and Web3. At Coreestate, we’re on a mission to redefine the real estate industry, making sustainable and affordable living a reality for all. As a cutting-edge Proptech startup, we’re excited to introduce the first groundbreaking Tokenized Real Estate project – GREV55.