Seven digital real estate investment platforms, including Shojin, from across the UK and Europe have joined forces to launch an international trade association to ensure investors can accurately evaluate investment opportunities and their associated risks.
The Association of Real Estate Investment Platforms (AREIP) has been formed with the ultimate goal of establishing common market standards, in order to build investor trust and liquidity. In a market accelerating at a remarkable rate the group recognises the need for transparency, trust and sensible regulation to set the foundations for long term sustainable growth and mainstream adoption.
Standardisation will first help investors better understand and compare the investments available to them and by doing so improve investment transparency and build investor confidence. Secondly, standardisation will help form the foundation upon which a centralised marketplace can be established, thereby facilitating liquidity and offering investors a wider variety of opportunities to develop their digital real estate portfolios. All founding members seek standardisation in four key areas:- 1) Terminology; 2) Investment descriptions and data; 3) Risk scoring; and 4) Operations, including technology.
The seven founder members include:
· BrikkApp, Czech Republic
· British Pearl, United Kingdom
· Max Crowdfund, Netherlands
· Occollo, Czech Republic
· Reinvest24, Estonia
· Shojin Property Partners, United Kingdom
· Simple Crowdfunding, United Kingdom
The trade association’s founder members will be joined at launch by an additional five real estate platforms, represented by companies in Spain, Dubai, India and Latvia, with the expectation of imminent further growth.
AREIP points to examples in global financial markets that have helped to foster market confidence, choice and liquidity:
“In the global capital markets Bloomberg manages a database for securities descriptions and data, S&P provides the market with securities risk ratings, and a multitude of trading exchanges help connect market participants to generate liquidity. All these services are essential for the efficient functioning of securities markets. AREIP, together with its members, would like to help establish a similar market foundation for the online real estate investment market with the final goal of achieving mass market adoption and increased liquidity. We see the steps to achieving this goal as follows: Step 1 - Collaboration; Step 2 - Standardisation; Step 3 - Marketplace.”
“Real estate, the world’s largest asset class previously reserved for institutions and wealthy individuals, is being made more accessible by hundreds of investment platforms from across the globe. We are on the cusp of enormous growth in this nascent market, and it is the responsibility of all participants to adopt high standards and transparency, which will in turn engender trust and lead to mass market adoption.”
“The evolution and growth of capital markets over the past 100 years has demonstrated the need and benefits of standardisation. As founding members of the Association of Real Estate Investment Platforms (AREIP) we invite all stakeholders to join us in establishing a market foundation that endures. Standardisation offers benefits to all market participants including issuers, property developers, investment platforms and investors. Standardisation also helps the development of primary issuance markets and the secondary trading market.”