AnnA operation, a real estate tokenisation

On 25 June 2019, the 700 square meters so-called “AnnA” private mansion located in Boulogne-Billancourt (near Paris) became the first European building purchased and held via a blockchain transaction. The €6.5 million transaction was carried out through the Equisafe investment platform, which aims to make financial assets accessible to as many people as possible thanks to blockchain technology.

The AnnA mansion, a superb Mansart-style building built at the beginning of the 20th century, first followed a classic sales process: a notarial deed validated the value of the building and marked the transfer of the latter to a simplified joint-stock company (AnnA). Equisafe, an investment platform operating via blockchain technology, then registered this company as an issuer in its system, before dividing it into a hundred digitized shares (also called “tokens”).

On June 25, 2019, all these shares issued by AnnA were transferred via blockchain to the promoter SAPEB Immobilier, assisted by developer Valorcim. The French member of the parliament Pierre Person personally executed the live transaction. The operation was successful thanks to the collaboration of CMS Francis Lefebvre Avocats (the law firm that worked on the legal structuring of the asset tokenization operation by registering them in a shared electronic registration device), Coblence & associés (the law firm that managed the fiscal and real estate aspects of the transaction), Screeb Notaires, the study of notaries in charge of the real estate aspects of the tokenization and the notarial deed of the private mansion, which was certified on the blockchain, SAPEB Immobilier and Valor Cim (real estate developers involved in the operation).

For the first time in Europe and France, real estate developers are therefore exercising their ownership rights over an entire building via the blockchain.

The difference between a classic operation and an operation like AnnA is that the property rights of the company holding the building are now fully encoded in the blockchain, encrypted on Equisafe virtual registry. Each token contains the terms and conditions for the purchase, sale and exchange of the securities, as well as the rights to which it gives access (dividends, vote, etc). This information is tamper-proof, unfalsifiable and permanently accessible, 24/7 thanks to blockchain. The cherry on the cake, it took us 30min to do what takes ~2months and cost at least 20.000€.

Blockchain benefits for the real estate industry

The use of blockchain technology in the real estate sector will create greater liquidity by making transactions faster and easier, thus overcoming several entry barriers while giving a better exit opportunity.

The registration of securities on a blockchain register (in which the information is certified by the notaries, digitalised, tamper-proof and in permanent access) allows a faster exchange of information. The blockchain makes it possible to follow the documents of the assets of its creation until the resale. Then, the tokenization mechanism makes the ownership shares partitionable to infinity and therefore allows investing even small amounts, providing easier access to investment for individuals.

The time saved is immense for each stakeholder. Real estate developers now have access to a vast shared (of course encrypted) database of investors to offer securities to; the blockchain saves the costs of data entry and constant verification of the information they usually must pay for, which leads to many administrative errors. For individuals, the time required to purchase and sell is considerably reduced since it will be possible to create an investor profile and access offers in less than half an hour on Equisafe. The platform will also democratise the investment by proposing a minimum investment amount of a few hundred euros depending on the nature of the security sold.

And it’s only beginning…

The AnnA event is a prototype operation that demonstrates Equisafe’s ability to handle complex transactions Starting this fall, the investment platform will be operational for investors, both individuals and professionals They will first have to pass a KYC (Know Your Customer, the regulatory process used to confirm the identity of customers) test, then complete a questionnaire designed to assess their risk profile and offer them suitable investments.

Equisafe plans to expand its activity beyond the real estate sector very soon and to offer through the blockchain the acquisition of financial securities, property rights in film financing companies and even in investment funds.

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Equisafe is an agent of Lemon Way payment service provider under registration number 85392 on the registry of REGAFI.