Dubai Introduces Real Estate Tokenisation to Attract Small Investors

Dubai is revolutionising its real estate sector with the introduction of tokenisation, a move that enables small investors to own shares in high-value properties without requiring substantial capital. Industry experts believe this initiative will not only democratise the real estate market but also attract a larger pool of international investors, enhancing liquidity and accelerating growth.

On Wednesday, the Dubai Land Department (DLD) officially launched the pilot phase of its 'Real Estate Tokenisation Project,' which will apply blockchain technology to property title deeds. This groundbreaking initiative transforms real estate assets into digital tokens, allowing multiple investors to co-own a single property. According to Wissam Breidy, CEO of HRE Development, this approach makes the market more accessible by eliminating significant financial barriers.

"This means investors can access high-value properties without needing substantial capital, effectively opening up the market to a broader audience. With blockchain ensuring secure transactions and mitigating risks, this project is poised to drive greater investment into Dubai’s property sector," said Breidy.

While the initial focus of real estate tokenisation may be on luxury and high-end properties, its benefits are expected to extend across all market segments over time. Breidy highlighted that affordable housing and commercial spaces could also take advantage of this model, making real estate investment feasible for a wider demographic.

Understanding Real Estate Tokenisation

Real estate tokenisation is the process of converting property ownership into digital shares using blockchain technology. Each property is divided into multiple tokens, allowing investors to purchase fractional ownership based on their budget and financial goals. This model differs from traditional crowdfunding, which allows small-scale investments through digital platforms but does not necessarily provide structured ownership.

Through tokenisation, investors can acquire stakes in high-value properties without committing to full ownership, making investment opportunities more flexible. The DLD’s primary objective with this project is to diversify property ownership and encourage multiple investors to co-own properties through a secure, transparent, and technology-driven model.

“Tokenisation enhances transparency by converting real estate assets into digital tokens, making it easier for investors to track and manage their investments,” added Breidy.

Impact on Short-Term Rentals and Branded Residences

The implementation of real estate tokenisation is expected to impact various segments of Dubai’s property market, including short-term rentals and branded residences. Rohit Bachani, co-founder of Merlin Real Estate, believes tokenisation will create lucrative investment opportunities across multiple categories.

“While luxury villas, waterfront properties, and branded residences will likely see the highest demand for tokenised investments, this innovation will also create new possibilities for short-term rental properties and residential developments in emerging areas,” said Bachani.

According to him, flexibility in payment plans combined with attractive returns will make tokenisation a compelling investment option across all market segments. With easier access to fractional ownership, investors can diversify their portfolios and explore high-yield properties in sought-after locations like Meydan.

Benefits for Large-Scale Projects

Industry insiders anticipate that large-scale property developments will be among the biggest beneficiaries of real estate tokenisation in Dubai. The ability to divide high-value commercial and residential properties into smaller investment units will allow developers to access alternative financing channels, reducing reliance on traditional banking methods and potentially accelerating project completion timelines.

Yogesh Bulchandani, CEO of Sunrise Capital, believes that commercial properties—especially office buildings and retail spaces—offer significant tokenisation opportunities due to their potential for stable income generation.

“Tokenisation presents an attractive financing alternative for developers. By breaking down investment barriers, it enables broader investor participation and provides businesses with an easier route to fractional ownership,” he stated.

Luxury residential properties, in particular, could benefit from fractionalisation by alleviating inventory pressures in the high-end market. Tokenisation may offer developers a more efficient way to sell premium real estate without requiring buyers to make full upfront payments.

Increased Liquidity in High-Value Real Estate

Farooq Syed, CEO of Springfield Properties, sees real estate tokenisation as a game-changer, particularly for high-value residential and commercial properties. Historically, large capital requirements have limited investor participation in these segments, but tokenisation could remove such barriers and increase market liquidity.

“Luxury and high-end developments can now attract a much larger investor base, while commercial properties will benefit from improved liquidity as businesses and individuals gain easier access to fractional ownership,” said Syed.

Tokenisation allows investors to purchase property shares, trade them on secondary markets, and potentially benefit from price appreciation over time. This flexibility makes real estate investment more accessible and dynamic, ultimately supporting the long-term growth of Dubai’s property sector.

The Future of Tokenised Real Estate in Dubai

Dubai’s real estate tokenisation project marks a significant shift towards a more inclusive and technologically advanced property market. By leveraging blockchain technology, the initiative enhances transparency, security, and accessibility, opening up investment opportunities for a broader audience.

As the pilot phase unfolds, experts expect tokenisation to reshape the real estate landscape by making property investment more flexible and liquid. The ability to fractionalise ownership will particularly benefit small investors, large-scale developers, and businesses looking for alternative funding methods.

With Dubai’s continued commitment to innovation and smart city development, real estate tokenisation is set to become a vital tool in attracting global investors and fostering long-term growth. The coming years will likely see an expansion of this model across various property segments, reinforcing Dubai’s position as a leader in real estate technology and investment.

Conclusion

Real estate tokenisation is an innovative solution that aligns with Dubai’s vision of a diversified, investor-friendly market. By allowing fractional ownership, this model lowers financial entry barriers and provides a secure, transparent framework for property transactions. As more investors and developers adopt tokenisation, the real estate sector will become more dynamic, inclusive, and liquid, paving the way for sustainable growth in Dubai’s booming property market.