Oxygen Hospitality Group believes in the future of technology in real estate—but the firm is taking the slow-and-steady path forward. It has signed an agreement with Token IQ to implement smart contracts and blockchain technology. The firm will start with short-term investment notes, which will be registered through the blockchain for investors, increasing security and transparency. Oxygen Hospitality is among the first commercial real estate companies to adopt smart contract and blockchain technology, and believes that this could be a catalyst for more technology adoption in the industry.
“Real estate tends to be a slower adopter of certain technologies. In general, real estate is not as forward thinking in terms of embracing technologies like blockchain,” Peter Anadranistakis, president and co-founder of Oxygen Hospitality, tells GlobeSt.com. “I thought that I could take something that was simple and common in the industry—a simple document—and work with a leading blockchain company to register those notes in the blockchain. People still get paper, so nothing changes from the day-to-day perspective, but I though this was a good step in creating an evolution instead of a revolution. Rather than being radical, I thought we could start with paper documents that most real estate companies work with and integrate it with the blockchain. It is fairly simple.”
Token IQ is a Scottsdale-based blockchain company, and for Anadranistakis, it was a good fit to provide a blockchain service. “I wanted to cut through the delays and deal with someone that I could trust and that could reliably deliver the technology on time and on budget,” he explains. Token IQ has blockchain-powered tokenization platform that allows short-term notes to be tokenized to increase security. Despite the adoption of this platform, Anadranistakis has continued to provide standard paper documents to his investors as part of the integration process.
Anadranistakis believes that blockchain technology is going to revolutionize the real estate industry, and this baby steps approach could persuade more investors to embrace it. “This is a game changer. If you take a simple document that many people use and register it on the blockchain, it makes it simple for the real estate company and it adds credibility and security for the investor,” he explains. “It is a win for both, and it is such a simple thing. I am hoping that we will be able to inspire other people that are working with paper to evolve and use some of these new technologies. From an investment perspective, particularly in notes, it adds value and it puts a lot of trust and transparency into the transaction.”
Investor's early responses to the blockchain technology are mixed. Some investors prefer the standard paper system, while others have really liked the new approach. “It depends on the investor. Some still want a paper document, and others think that it is amazing,” Anadranistakis says. “It is a new thing, but I am already starting to see a trend with a certain group of our investors that is really embracing this. I do not think that paper is going away, but we are doing out part to enhance transparency, investor confidence and to educate investors.”
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Kelsi Maree Borland
