By CNBCTV18.com Contributor Apr 7, 2021 2:31:17 PM IST (Published)
Fractional Ownership is a concept that has caught up in various developed economies like America, Singapore, Hong Kong and is now gaining traction in India.
Real estate has provided generations of investors with wealth. However, it has historically been reserved for those with specialized knowledge, the right connections, and access to a huge amount of capital. This has kept investing in Commercial Real Estate(CRE) out of reach for most until a few years ago. However, to have a much-needed edge, people need to understand that CRE investments are a very important part of their portfolio.
The major traits that are common in the wealthiest individuals and separate them from the rest are their Real Estate investments. Further, their income is not correlated to their time spent working and they focus on cash flow through Real Estate. These insights play a crucial role in transforming the way people invest in the CRE sector. Hence, as a solution to have specialized knowledge, the right connections, and access to a huge amount of capital, Fractional Ownership is the inevitable change coming to the CRE market.
Concept of Fractional Ownership
There exists a premium commercial building worth 50 Crore, generates good cash flow and is a leased asset to a verified institutional-grade tenant. Aleksa (a new age investor) is looking to participate in the kind of asset with all the above said features but only wants to do it with just 25 lakh.