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Bauwens Group, one of Germany's leading real estate project developers, has acquired 15 percent shares of Fundament Group, a Berlin-based blockchain firm that issues real estate security token on the ethereum blockchain.
In July 2019, Fundament Group received approval from the German Financial Market Supervisory Authority (BaFin) for the country’s first tokenized real estate bond, with an issue volume of €250 million.
Bauwens Group, which is known for integrating intelligent and digital technologies into the development and realization of its real estate portfolio, has €6.7 billion ($7.35 billion) in managed project development volume and over 370 employees.
With this strategic investment from Bauwens, Fundament Group said that it has not only gained a long-term partner in the real estate development market but also access to an extensive pipeline of projects in Germany’s key metropolitan areas including Munich, Hamburg, Berlin, and Frankfurt.
“We are delighted to announce this partnership with Fundament Group which recently achieved a decisive breakthrough in Germany by securing the first regulated tokenized real estate bond,” Alexander Jacobi, Managing Director of Bauwens digital GmbH said. “The Fundament Real Estate Token is an extremely interesting option for selling our real estate and we are proud to support them with our real estate and digitization expertise.”
Speaking to CoinDesk, Fundament CEO Thomas Ermel revealed that the firms started negotiating for a potential partnership in May this year, adding that Bauwens bought 15 percent stake in Fundament in cash in September.
He also clarified that while Bauwens’s massive pipeline will be available for tokenization, not every project fits Fundament’s investment criteria, adding:
“We will select the most suitable projects out of the pipeline for our portfolio.”
Per the report, the current portfolio to be tokenized includes residential, commercial and hotel properties, estimated to total over 680,000 square feet upon completion. Fundament Group expects a return on the projects in the mid-to-high single digits.
