Tokenised Commercial Real Estate Fund — UK & European Properties

Investment Overview

This fund uses blockchain-based tokenisation to fractionalise beneficial interests in a portfolio of UK and European commercial real estate assets. Each token issued by the fund represents a proportional economic interest in the underlying property portfolio, with quarterly rental income distributed to token holders in proportion to their token holdings. The fund targets a rental yield of 6–8% per annum over a five-year fund life.

Tokenisation enables a lower minimum investment than traditional commercial property funds — GBP 25,000 rather than the GBP 100,000–500,000 minimum typical of institutional property vehicles — while maintaining the structural protections of a regulated fund framework.

What Is Real Estate Tokenisation?

Tokenisation is the process of issuing digital tokens on a blockchain that represent ownership or beneficial interest in a real-world asset. For real estate, tokenisation converts an illiquid, high-minimum investment (a building or portfolio of buildings) into digital units that can be subdivided, tracked, and transferred via a blockchain ledger.

The token itself is a digital record maintained on a regulated, permissioned blockchain. It does not represent direct legal title to the property (which remains held by the fund's property holding entities in the normal way), but rather a beneficial economic interest — entitlement to a proportional share of rental income and capital returns from the underlying portfolio.

The key practical benefits of tokenisation for investors are:

• Lower entry threshold: Fractionalisation allows investment at GBP 25,000 rather than buying a whole property or large fund unit
• Secondary market: Tokens can potentially be bought and sold between investors on the fund's secondary token market between formal redemption windows
• Transparency: Blockchain-recorded token ownership and distributions provide an auditable, tamper-resistant record of investor interests and income payments
• Efficiency: Token-based administration reduces the operational friction of investor record-keeping, distributions, and transfer processing

The Property Portfolio

The fund invests in a diversified portfolio of UK and European commercial property across three primary sub-sectors:

Urban logistics and distribution (40–50% of portfolio): Last-mile logistics facilities, urban warehouses, and distribution centres serving e-commerce fulfilment and food delivery operations in major UK and European cities. This sector has experienced the strongest structural demand growth of any commercial property type, driven by the permanent shift to online retail and same-day/next-day delivery expectations. Logistics property vacancy rates in major markets remain near historic lows as of 2026.

Office and co-working properties (30–35%): Grade A office buildings in regional UK cities (Manchester, Edinburgh, Birmingham, Bristol) and selected European cities (Amsterdam, Hamburg, Lisbon), targeting tenants in professional services, technology, and financial services. The fund focuses on ESG-compliant, energy-efficient buildings that meet current tenant sustainability requirements — a distinction that has become critical to rental demand as corporates face scope 3 emissions reporting obligations.

Mixed-use and retail warehouse (20–25%): Mixed-use properties combining ground-floor retail with upper-floor residential or office use in UK and European town centres, plus retail warehouse parks — out-of-town retail formats (DIY, home furnishings, gym operators, click-and-collect facilities) that have demonstrated resilience relative to high-street retail.

Quarterly Income Distributions

Rental income collected from tenants across the portfolio is distributed quarterly to token holders in proportion to their token holdings. The distribution is calculated as: (total net rental income for the quarter) × (investor's tokens / total tokens outstanding).

Income is paid net of property management fees, property-level operating costs (insurance, maintenance, void costs), fund management fees, and blockchain infrastructure costs. The fund manager's target net quarterly distribution equates to 1.5–2.0% per quarter (6–8% annualised).

Secondary Token Market

The fund operates a secondary token market on its regulated platform, where token holders can list their tokens for sale and prospective buyers can bid to purchase them. This market operates continuously (subject to the fund's trading rules and KYC/AML requirements for new buyers), providing a potential liquidity mechanism between the fund's formal annual redemption windows.

The secondary market does not guarantee liquidity — there is no obligation on any party to buy tokens offered for sale. Token prices on the secondary market will reflect buyers' assessments of the portfolio's net asset value, expected income, and time remaining in the fund life, which may be above or below the fund's calculated NAV per token.

Annual redemption windows occur in Q4 each year, during which the fund manager offers to repurchase up to 10% of outstanding tokens at the independently calculated NAV, subject to available fund liquidity.

Regulatory Framework

The fund is structured as an English Limited Partnership and is operated by an investment manager authorised and regulated by the Financial Conduct Authority (FCA). Token issuance and secondary market operation are designed to comply with the FCA's guidance on cryptoassets and digital securities. Tokens are intended to be classified as security tokens (representing financial interests) rather than utility tokens, bringing them within the scope of the relevant FCA regulatory framework applicable to such instruments.

Investors must complete KYC/AML verification and sophistication certification before purchasing tokens.

Risk Factors

Commercial property market risk: Commercial property values can fall as well as rise. A deterioration in occupancy rates, tenant defaults, rising interest rates (which affect property valuations), or structural changes in demand (e.g., further shift from office to remote working) could reduce both rental income and capital values.

Technology and operational risk: Blockchain infrastructure, while mature, introduces operational risks not present in traditional fund structures — including smart contract vulnerabilities, blockchain network issues, and digital custody risks. The fund employs established, audited smart contract infrastructure and regulated digital custody, but technology risk cannot be entirely eliminated.

Secondary market liquidity: The secondary token market does not guarantee the ability to sell tokens at any time. In periods of low demand, it may not be possible to sell tokens at or near NAV.

Tenant concentration risk: Commercial property income depends on tenants continuing to pay rent. A major tenant default could significantly reduce quarterly income distributions.

Currency risk: The fund is GBP-denominated. European property assets denominated in EUR introduce GBP/EUR exchange rate risk, which the fund manager manages through hedging instruments.

How to Enquire

Contact our investment team to access the fund prospectus, FCA authorisation details, portfolio overview, smart contract audit, and token subscription documentation. This opportunity is available to sophisticated investors only. Minimum investment GBP 25,000 (approximately one unit of 1,000 tokens at current NAV).

Important: Target yield of 6–8% p.a. is based on the fund manager's rental income projections and is not guaranteed. Commercial property values and rental income can fall as well as rise. Tokenised securities involve technology risks in addition to property investment risks. This is an illiquid investment with limited redemption mechanisms. Independent financial and legal advice should be sought before investing.