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Sumitomo Life invests in tokenized Blackstone real estate fund

Sumitomo Life invests in tokenized Blackstone real estate fund

CointimeCointime2023/12/20 16:03
By:Cointime

Yesterday bank-backed startup  Digital Securities  announced its second tokenized real estate issuance in Japan. Sumitomo Life was the primary institutional investor and a Blackstone real estate fund underpins the  tokenization . Digital Securities’ backers are Marubeni and regional Joyo Bank. The bank lent money to the tokenization structure.

There are already several  real estate tokenizations  in Japan, but many target retail investors and relate to a specific building. In contrast, the Digital Securities tokens currently target only institutional investors. Nagoya Bank was the investor in the first security token. 

Both of Digital Securities’ security tokens were underpinned by a Blackstone Group real estate fund where the fund investment is put into a trust. We believe Blackstone only targets qualified institutional investors in Japan.

The offering turns “anonymous partnership interests” into security tokens.

Usually, the transfer of an interest in a silent partnership requires a written notice with a certified date. As part of a Japanese regulatory sandbox, Digital Securities received a certification that it can complete all the necessary steps digitally. That includes issuance, custody, sale and secondary distribution.

Most of these steps are executed on the Ownership tokenization platform. Digital Securities has a 50% stake in Ownership and classifies it as a subsidiary.

Digital Securities says it “is developing blockchain technology with the aim of providing next-generation financial products that will help anyone become a wealthy person. We are currently preparing a real estate STO (security token offering) business that will enable the trading of actual real estate or trust beneficiary rights backed by real estate as security tokens.”

Japanese real estate tokenization

Meanwhile,  Mitsui Co Digital Asset Management  (MDM) is targeting retail investors with its Alterna real estate funds. It uses tokenization to remove the need for brokers and enable the  asset manager  to have  direct client relationships . Clients use the Alterna online platform to invest. It has a few alliances with other platforms, such as  Sony Bank , which act as introducers but redirect investors to the Alterna website.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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