New Frontiers in Real Estate Finance: The Rise of Micro Markets

This book explores three innovative concepts in real estate finance: factorization, digitalization, and tokenization. It discusses the use of factor-based real estate derivatives, the digitalization of commercial real estate, and the emergence of 'digital rights' or property rights for smart buildings in smart environments. It also proposes concepts and methods for identifying, pricing, and trading these new property rights, which will dominate commercial real estate in the future. Tokenization is explored as an alternative to securitization, with two innovative applications: private commercial real estate index tokenization and data tokens for smart buildings. The book is essential reading for researchers and professionals in real estate, finance, and smart technology.

Format: Paperback / softback
Length: 194 pages
Publication date: 25 September 2023
Publisher: Taylor & Francis Ltd

This book delves into three groundbreaking concepts and the financial instruments associated with them that have the potential to revolutionise the realm of real estate finance. The first concept explored is the factorisation of commercial real estate, which involves the use of factor-based real estate derivatives. In-depth academic references are provided to address methodological issues related to factors in real estate risk analysis.

The book then shifts its focus to the digitalisation of commercial real estate. The environment in which buildings operate is undergoing a rapid transformation. Cities that were once composed of inanimate architectural structures are evolving into digital entities, acquiring digital skins and becoming smarter. Smart technologies applied to the built environment are fundamentally altering the role of buildings in cities and their interactions with their occupants.

To address these changes, the book introduces the concept of smart space. It examines the emergence of 'digital rights or property rights for smart buildings in smart environments.' It proposes concepts and methods for identifying, pricing, and trading these new property rights, which are expected to dominate the commercial real estate landscape in the future.

Furthermore, the book explores the tokenisation of commercial real estate. Tokenisation, sometimes referred to as an alternative to securitisation, is a novel financial engineering tool applied to real assets. The book suggests two innovative applications of tokenisation: private commercial real estate index tokenisation and data tokens for smart buildings.

Through factorisation, digitalisation, and tokenisation, commercial real estate emerges as a forefront of innovation. The unique characteristics of real estate, stemming from its physicality, unlock new ways of thinking that have the potential to profoundly impact other asset classes by paving the way for micro markets. Factor-based property derivatives play a pivotal role.

Weight: 453g
Dimension: 234 x 156 (mm)
ISBN-13: 9781032009667