Blockchain Technology Brings Fractionalized Investment to Real Estate Sector
The real estate industry has long been touted as an area that could greatly benefit from the implementation of on-chain records, whether it’s a blockchain-based deed or other data. One startup, Mogul, is at the forefront of this innovation, utilizing blockchain technology to bring fractionalized investment to the sector. According to a report from Blockworks, Mogul has recently launched Mogul Clubs, user-created real estate investment groups using the Avalanche C-chain, which have now officially exited beta.
The goal of Mogul Clubs, as stated by the company, is "to give investors seamless access to high-yield, high-return single-family rentals across the US sunbelt—without the typical capital barriers or landlord headaches." As reported by Blockworks, Mogul first launched in 2023 and currently has over $22 million in assets on its platform. The company’s CEO, Alex Blackwood, told Blockworks that they’ve already been able to give investors 10-12% cash-on-cash returns so far, with an average internal rate of return (IRR) of 18.8%.
Mogul’s platform allows retail investors to join more than 30 different clubs, with the startup vetting every investable property on its platform to give investors the highest ROI possible. According to Blackwood, as quoted in the Blockworks article, "Mogul has a vetting process even stricter than Harvard’s, with less than one percent of properties we come across ultimately making it to the platform." Investors who join these real estate clubs can decide whether they want to buy in by themselves or alongside others, with a minimum investment of $250 required to get started.
The process of investing through Mogul’s platform involves the creation of a proprietary on-chain property NFT that represents the investor’s fractional membership interest in the LLC that owns the real estate. As explained by Blackwood to Blockworks, "Those tokens are not AVAX itself but custom ERC-1155 compatible contracts Mogul wrote specifically for our platform, so all ownership records, distribution rights, and governance votes are immutably recorded on the chain."
Avalanche developer Ava Labs has also launched its own Mogul Club, using the blockchain to power stablecoin-based real estate investments. This move demonstrates the growing interest in blockchain-based real estate investment solutions. Mogul was founded by two former Goldman Sachs real estate investment group employees, and their site also offers a range of free calculators, including a rental property calculator, an Airbnb income calculator, a real estate calculator, and an investment property calculator.
In an interview with Blockworks, Blackwood explained that fractionalized assets can sound complicated, but Mogul’s platform aims to make it accessible to anyone. "We want to give investors seamless access to high-yield, high-return single-family rentals across the US sunbelt—without the typical capital barriers or landlord headaches," he said. With Mogul Clubs now out of beta, the company is poised for further growth, providing investors with a unique opportunity to access the real estate market through blockchain-based fractionalized investment.
As the real estate industry continues to evolve, it’s clear that blockchain technology will play an increasingly important role in shaping the future of investment. Mogul’s innovative approach to fractionalized investment is just one example of how this technology can be used to create new opportunities for investors. According to Blockworks, Mogul’s platform has already seen significant traction, with over $22 million in assets on its platform and a growing number of investors joining its real estate clubs.
