Global Tokenized Real Estate Market May Surge to $4T by 2035, According to Deloitte.

Deloitte Predicts $4 Trillion Tokenized Real Estate Market by 2035

Real estate tokenization, once a niche concept, is quickly becoming a fundamental way in which properties are financed, owned, and traded, according to a new report from the Deloitte Center for Financial Services published Thursday.

Deloitte projects that the tokenized real estate market could expand to $4 trillion by 2035, growing at an impressive compound annual growth rate (CAGR) of 27% from its current size of less than $300 billion.

The tokenization of real-world assets (RWAs) is a fast-growing field sitting at the intersection of blockchain technology and traditional finance. This process involves creating digital representations of physical assets like real estate, bonds, and funds, allowing for more accessible, efficient, and transparent transactions on the blockchain.

For real estate, tokenization offers considerable advantages, including simplifying complex agreements, reducing costs, and improving settlement speeds. The report highlights how tokenization can automate real estate fund launches, with blockchain-based smart contracts handling ownership transfers and capital management. A notable example is Kin Capital’s $100 million real estate debt fund, managed through their tokenization platform, Chintai, which utilizes trust-deed-based lending, as noted by Deloitte.

Deloitte’s analysis breaks down tokenized real estate into three main categories: private real estate funds, securitized loan ownership, and undeveloped or under-construction land. Among these, tokenized debt securities are expected to dominate, with a projected market value of $2.39 trillion by 2035. Private real estate funds are expected to contribute around $1 trillion, while land development projects could account for approximately $500 billion.

Despite the vast potential, Deloitte acknowledges that significant challenges remain in the tokenized real estate space, including regulatory concerns, custody of assets, cybersecurity risks, and handling defaults. As these obstacles are addressed, tokenization has the potential to reshape the real estate market, bringing greater liquidity, efficiency, and global access to property investments.