Singapore digital securities platform tokenises US real estate fund

SINGAPORE Exchange-backed digital securities platform ADDX and investment management firm Investcorp have tokenised a private real estate fund focused on the United States' "Sun Belt".

Part of the US$150 million fund was raised via tokens, but the sum was not disclosed. The funds raised were invested in five multi-family complexes with over 2,200 units in the states of Texas, Arizona and Georgia. The portfolio's current occupancy rate stands at 95 per cent.

Multi-family complexes serve multiple households in separate units - a condominium is one such example.

With tokenisation, which involves converting the partial or full ownership rights of an asset into a digitally represented token, the minimum investment ticket in this case was reduced to US$20,000, down from some US$500,000 typically required for private real estate funds, ADDX and Investcorp said in a joint press statement on Thursday.

This fund is the first product under a new partnership between ADDX and Investcorp, which seeks to expand the use of digital securities in alternative assets. Investcorp, which is headquartered in Bahrain, is looking to expand its Asia footprint and has invested about US$500 million in the continent over the past 18 months.

The two companies will jointly explore projects in areas such as private equity, real estate, credit management, absolute returns investments, strategic capital, and infrastructure.

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YC Tang, Investcorp's vice-president for investor relationship management in Asia, said the partnership helps offer the segment of "underserved investors" diversified alternative investment products through a secure and efficient platform.

ADDX's chief commercial officer Choo Oi Yee said: "When we look at the way sovereign wealth funds and large pension funds invest, alternative assets make up a significant and growing share of their holdings because the blend of private and public investments helps to maximise long-term returns.

"With digital securities enabling fractional sizes, accredited individual investors can now, for the first time, take a similar approach. There is fairer access to economic growth."

ADDX, formerly known as iSTOX, had previously also tokenised part of a private real estate investment trust from property giant Mapletree Investments.