Analysis of ICO Global REIT
Global REIT is a Real Estate Investment Trust based on blockchain. The idea of the project is quite simple and convincing at the same time.
Traditional REIT is an alternative to private real estate investments. The REIT manages a plurality of properties, buys and sells them, rents it out, finances real estate. And REIT shareholders receive dividends.
Global REIT complements this model with several features:
- the possibility of free accommodation in hotels under management by Global REIT;
- loyalty program;
- ability to acquire assets globally, as opposed to traditional REITs operating within a certain territory;
- token holders will be able to participate in fund income management;
- monthly dividend payout.
The idea is simple but quite promising. However, the competition from both traditional and international REITs should be taken into account.
Global REIT is going to start its business in Dubai, UAE, and then will operate around the world. The initial value of AUM will be $ 75 million, and it will reach $ 10 billion in three years.
GREM and GRET tokens give the right to receive income and are utility tokens at the same time.
Hard cap and soft cap are not set. However, the founders of the project are going to purchase real estate worth $ 75 million in June 2018 . It is unclear from what source these funds will come.
The first dividend payout should take place in July 2018. And it is planned to purchase 9 real estate objects in the UAE and the UK (hotels, residential buildings, shopping malls) up to the end 2018.
The business plan looks very blurred and unrealistic.
The project has no marketing strategy. It is not clear how the project team intends to attract investors and promote the project to the market.
The project team includes 6 people having experience in real estate sales, enterprise, international trading, merchant banking and industrial management, financial and strategic planning, asset development and management, software development and programming.
The project team is small but it has relevant experience. Although there is no information about team members' participation in certain projects and startups.
The Vision of the Market
The project team gives a small overview of the REIT market in the US, Europe and Asia.
Data on the REIT market in the UAE are given separately. This market is quite young, the first public REIT in UAE appeared in 2010, and the first asset under management was a 4-star hotel.
Also the tourist market growth in China and Asia is mentioned. The founders of the project are primarily focused on the purchase of hotels.
It can be concluded that the project team has a fairly clear vision of the market. However, the project team doesn't pay attention to competition with both international and local REITs.
Understanding of the Target Audience
The target audience of the project consists of three groups:
- Conservative crypto-investors who seek to invest in reliable assets and receive a stable income;
- Real estate owners who get access to the liquid market in cryptosphere;
- Real estate Investment Trusts (REITs) which can join the infrastructure of the blockchain.
However, the analysis of the target audience by socio-demographic and other criteria was not carried out.
The founders of the project roughly understand for whom they develop their product, but they don't have a detailed and segmented vision of the target audience.
The founders of the project position Global REIT as a global project which gives additional benefits compared to traditional REITs:
- Monthly dividend payment;
- Loyalty program;
- No regional restrictions.
However, the founders of the project don't compare their project with competitors, so there is no way to judge whether the project is better than already existing REITs.
The Global REIT project has several advantages:
- Simple and clear project concept;
- The project is related to the real economy;
- Growing REIT market.
Disadvantages of the project are as follows:
- Lack of marketing strategy;
- Lack of competitive environment analysis;
- Vague business plan.