DEMOCRATISING REAL ESTATE OWNERSHIP
HOW COMMERCIAL REALTY FARED IN THE YEAR 2021? With the decline in covid cases in the second half of 2021, we witnessed commercial real estate showing signs of recovery. The utility of grade-A buildings procured by MNCs started picking up, as the markets displayed better resilience than during the first wave, in 2020. Hiring by every MNC in 2021 saw a significant upsurge which led to a higher demand for office space expansions. Also, many tenants have invested significant capex in upgrading the interior fit-outs with an effort to create a “COVID enabled workplace” to promote a safe back to office transition. HOW IS FRACTIONAL INVESTMENT BENEFICIAL FOR INVESTORS? Traditionally, CRE had high barriers to entry for retail investors due to the large quantum of funds required to participate. Fractional ownership platform has eroded this barrier. The CRE rental gives investors a fixed monthly income source with an underlying hard asset capital appreciation, making it competitive with fixed income and debt products. The overall IRR from fractional commercial real estate is benchmarked to 15%-25% making it competitive with equities with significantly lower risk. Further spreading the risk, the investors can create a diversified portfolio across various cities, properties, and asset type. THE REASONS FOR THE POPULARITY OF FRACTIONAL OWNERSHIP IN CRE AMONGST NRIS NRIs are often located in developed countries that majorly have low interest rates and low yield fixed income options. This has made investing in Indian real estate and fixed income products a preferred avenue for NRI investors. Alternative products such as MYRE’s fractional platform has given them access to the asset class without the WHAT IS THE SIGNIFICANCE OF TECHNOLOGY IN FRACTIONAL OWNERSHIP? LEARNINGS FROM 2021 & OUTLOOK FOR 2022 Being the first Neo-realty investment platform, in 2021 it very quickly became apparent to us that we would have to often tackle problems that did not have this need, fractional CRE offerings by Myre Capital provides them with stable monthly rental income. To develop robust solutions, we approached problems from a multifaceted approach and leveraged technology to enable the same. We came up with various initiatives to tackle the COVID waves and associated lockdowns. For instance, we have coined the “home from work” . initiative as an effective alternative to work from home. We also prioritise communication, transparency, and customer satisfaction with our investors and partners. The supply and demand assessing factors would continue to evolve in 2022 and CRE will continue to attract more FDIs which will further propel the sector. Models such as fractional ownership, co-working, etc. will drive the demand as hybrid work culture and democratisation of CRE investments are being highly appreciated. We are looking at potential properties across India, not ignoring Tier 1, 2 cities as well as global expansion of MYRE Capital and are working towards achieving the same. Strategic partnerships to help build joint value is another of our key focus areas for the upcoming year. To bridge the knowledge gap about fractional
operational and management burden. Also, NRIs often have family residing in India and are keen to build an alternative passive income source for them. Catering to this need, fractional CRE offerings by Myre Capital provides them with stable monthly rental income.
With the outburst of the pandemic, virtual tour of properties have helped in decision making as it provides an authentic mirroring of the assets, saving time and access to properties across the world. We have integrated operational automation tools to facilitate the volume of tasks and eliminate any human error. The entire model is based on the premise of scalability. We have developed proprietary technology to make the entire investment and on boarding process for an investor completely digital. The
process can be completed in 5 minutes. Further all documentation and reporting is provided in real time to each investor in the Myre Capital investor dashboard.
We have developed state of the art algorithms that process 30+ data points and help identify undervalued assets which have a higher intrinsic value than the proposed market value. This enables us to process more than 200 potential opportunities per day.
ownership among potential investors, we are also exploring ways to design a system that will help educate them
Tags : ARYAMAN VIR FOUNDER & CEO MYRE CAPITAL THE FRACTIONAL INVESTMENT MODEL AND EXPRESSES OPTIMISM FOR THE COMMERCIAL REAL ESTATE IN 2022