Fractional Ownership – The Next Revolution in Real Estate- Making Investment both Lucrative & paperless
Dhaval Mehta, Solicitor
Founder & Managing Partner, D. M. Legal Associates | Seasoned Attorney | Legal Counsel I Arbitrator & Skilled Negotiator I Insolvency Professional | Litigation Expert I Asset Restructuring Specialist
Fractional Ownership is soon likely to lead the way for lucrative real estate investment. It provides tremendous opportunities and is set to tackle various issues faced while investing through traditional investment options. It is all set to become the future of real estate investing. It opens gates to investing in extremely attractive real estate assets that we’ve kept away from in the past due to high entry barriers.
Fractional Ownership is on the rise both globally and in India. With Fractional Ownership, one can co-invest in these assets with others by investing as low as Rs 10-20 lakh. Fractional Ownership platforms give you easy and affordable access to such investment opportunities, which are pre-vetted and managed by a team of professionals. It solves for access and affordability, making it as simple as owning stocks.
Consider a pre-leased office space worth Rs 20 crore or a premium residential development at an up-and-coming location worth Rs 2 crore, each with high growth potential. A high-quality commercial real estate investment can generate an above 12% annualized return with minimal volatility and also give you security through a tangible asset.
This fiscal there will be over Rs 1000 crore invested through this format. At Frxnl, we have created an investor-friendly platform too that not only makes the entire investment process hassle-free with an end-to-end digital platform but is also completely transparent. Considering this is a new product, it is natural to have apprehensions about the security of your money. An added advantage of investing fractionally is that your money will be completely secure with the adoption of escrow accounts overseen by institutional trustees. You can expect capital appreciation, and even monthly rentals (for leased properties) from your investment, making for attractive yields.
领英推荐
The best feature of Fractional Ownership is that it solves this issue of liquidity and exit from investment unlike traditional models, by allowing an investor to sell their shares privately or through the platform.
That said, every investment opportunity does come with its risks. Fractional Ownership, just as traditional real estate investing, should only be considered for long-term appreciation. It needs an investment horizon of 3-5 years to generate good returns. The secondary sale of the market will also be driven by supply-demand forces, making it not an extremely liquid investment. However, most platforms do offer a good ecosystem of investors to facilitate an investor’s exit. The fractional way of investing is emerging rapidly and will be a USD 5 billion market by the year 2030 in India.
source:By Amit Uppal, Co-Founder, Frxnl