PROPERTY transactions in the Philippines will soon be tokenized as new real-estate player C Estates Inc. announced on Monday that it will officially launch in the latter part of this year an online platform that allows investors to buy a fraction or whole of any property in the country using tokens.
Tokenization is the process of protecting sensitive data by replacing it with an algorithmically generated number called a token.
Because C Estates wants to set a global industry benchmark, it adopts this for real-estate transactions to replicate the success of its use in the financial sector that has long been embracing this on monetary assets.
Apart from security issue, this marketplace was also conceptualized due to the slow and strenuous process of purchasing and selling estates in the country, according to C Estates Inc. CEO Teru Sumida.
“The idea behind C Estates is also to make the process of buying and selling less complicated for investors,” he said.
This is by way of using a blockchain technology which, according to him, will help promote more transparency and efficiency in any kind of transaction since it is best matched for the real-estate industry.
C Estates will have a soft launch of the platform by end of the month, showcasing the first phase of the project, which is property listing and virtual trading. This will run for three months meant to educate the users—brokerage firms, property developers, individual property owners and buyers or investors—and make them familiar with the ins and outs of the portal. The official rollout is set on November 15, wherein everyone can really buy and sell properties on the platform.
“We are not, however, focused on the primary market like most property developers who pre-sell condominiums that are still under construction or about to be constructed. Buyers in that primary market usually have to wait five years until completion,” Sumida said, while citing that their main focus is on the secondary market or estates that already exist since they are more attractive and can create income right after purchase.
Initially, C Estates will offer properties that are under the Condominium Certificate of Titles that can be owned by foreign investors. In the short term, the company will have them listed and marketed to the global real-estate investors keen on buying property in the Philippines.
“So it can be residential, it can be commercial. Because our expertise is foreign investment, we want to cater properties that can be owned by foreign people,” C Estates COO Elixes Becislao told reporters during their media briefing in Makati City. “Right now, we’ve been getting demands from Chinese, Japanese and Koreans. But mostly it’s the Chinese people that are actually buying a lot of properties.”
Even though the platform is not yet live, he noted that they have already worked and partnered with key players in the industry. In fact, they have gotten several hundreds of property listings.
The next phase is to be able to cater to Transfer Certificate of Title that can only be owned by Filipino nationals. While they are still waiting for the regulations to be in place, Becislao is confident this will eventually happen. Part of their road map, he revealed, is to work with the government in order for them to equip it with technologies so as to build the right infrastructure needed.
“Because in Japan, if you would like to purchase a property, it will just take you an hour or a couple of days. It’s [a] done deal. But in the Philippines, the average is around three to four months to complete the transaction. If other countries were able to achieve that, why not the Philippines? So that’s one of our visions,” said the COO. “Pretty much, I can say within the next two to three years or less, hopefully, we could have a better infrastructure and, at the same time, legal framework that we can bank into.”
Currently, C Estates is working with several institutions in the government, such as the Securities and Exchange Commission, to ensure that they are compliant with the law, and all the legalities.
“We’re tapping at the retail market; we’re talking about the public to be able to buy properties in small portions. So pretty much, of course, we want to protect as well the consumers participating on our platform,” Becislao said.
Pressed on regulations they push, he said that it’s mostly centering on the digital assets. “Because as per the current draft that we have right now, the SEC doesn’t want to deal with any digital assets or crypto currency that don’t have any underlying value. But what we are tokenizing is a property with underlined value. It’s a physical asset, wherein you can go there, you can see it. That’s actually one of the good things about what we are doing right now.”
Bullish on the market’s positive reception of its platform, C States also plans to offer additional services, such as crowdsourcing, time sharing and land banking. It also intends to provide mortgage and home loan financing services and, eventually, expand the business to Malaysia, Indonesia, Thailand, Cambodia and Vietnam in preparation for the Asean integration.