Is Blockchain Reshaping Retail Real Estate Investment Through Tokenisation and Fractional Store Ownership?

Retail real estate commands institutional attention because it anchors long-term leases, brand visibility, and predictable cash flows. In 2023, global real estate transaction volumes reached approximately US$634 billion, according to CBRE Group. Even in a moderated capital markets environment, investors continued to allocate capital to income-generating retail assets with strong tenant covenants. At the same time, digital asset infrastructure matured. The convergence of these trends has brought tokenised retail assets and fractional store ownership into the mainstream of alternative investment strategy. 

Tokenisation converts ownership interests in physical retail assets into digital tokens recorded on a blockchain. These tokens can represent equity, debt, or revenue-sharing rights, subject to securities laws and regulatory approvals. Institutional investors, asset managers, and technology platforms now use this structure to broaden capital access and improve liquidity in commercial real estate. 

The Institutional Case for Retail Tokenisation 

Retail assets generate long-duration cash flows under lease agreements that often span 10 to 20 years. This profile aligns with the income mandates of pension funds, sovereign wealth funds, and private credit vehicles. Yet commercial real estate remains capital-intensive and operationally complex. 

The scale of the opportunity is clear. In its 2023 Real Estate Market Outlook, JLL reported that global direct real estate investment volumes remained above pre-pandemic averages despite cyclical headwinds. Retail assets in prime locations continued to attract institutional capital, particularly grocery-anchored centres and high street properties with firm tenant sales productivity. 

Tokenisation introduces a programmable layer on top of this asset class. Smart contracts can automate the distribution of rental income, enforce compliance rules, and track ownership transfers in real time. For institutional allocators, this creates operational efficiency and auditability. For private investors, fractional ownership reduces minimum ticket sizes and expands access to assets that were historically reserved for significant funds. 

Capital Formation Through Digital Securities

 

Security token offerings and regulated digital asset platforms have accelerated adoption. In 2018, Elevated Returns partnered with tZERO to tokenise equity in the St. Regis Aspen Resort, raising US$18 million through a digital securities offering filed under U.S. regulations. The transaction demonstrated that high-value real estate could attract global investors through blockchain infrastructure while remaining compliant with securities law. 

In Europe, BrickMark acquired a commercial property on the Bahnhofstrasse in Zurich in 2019 using blockchain-based tokens valued at CHF 130 million (US$168 million), according to company disclosures. The seller accepted tokens as partial consideration, marking one of the most significant blockchain-based real estate transactions at the time. 

Large financial institutions have also validated the model. In 2023, JPMorgan Chase executed a tokenised collateral settlement on its Onyx Digital Assets platform in collaboration with BlackRock and Barclays, as reported by the bank. While the transaction focused on money market fund shares, it demonstrated how tokenisation can streamline settlement and collateral management across asset classes, including real estate-backed securities. 

These transactions show that tokenisation operates within established financial frameworks rather than outside them. Regulated exchanges, licensed custodians, and compliance-driven onboarding processes anchor investor protection. 

Fractional Store Ownership and Platform Scale

 

Retail-focused fractional ownership platforms have moved from pilot phases to scaled deployment. RealT has tokenised dozens of residential and mixed-use properties in the United States, offering fractional interests through ERC-20 tokens on the Ethereum blockchain. According to its public disclosures, the platform distributes rental income to token holders regularly, subject to regulatory eligibility requirements. Although RealT concentrates on residential assets, its operating model demonstrates how fractionalisation can create secondary liquidity and transparent income reporting. 

In India, Property Share has facilitated fractional ownership in Grade A commercial properties leased to institutional tenants. The company reports that it has managed assets of over ₹1,500 crore (US$165 million) and distributed rental income to investors through structured investment vehicles. While these offerings operate through traditional legal structures rather than public blockchains, they illustrate strong domestic demand for fractional exposure to income-generating retail and office assets. 

Global asset managers have also entered the digital asset space. BlackRock launched the BlackRock USD Institutional Digital Liquidity Fund on the Ethereum blockchain in 2024, according to company announcements. Although the fund invests in U.S. Treasuries rather than retail real estate, it confirms that the world’s largest asset manager views tokenisation as compatible with institutional governance standards. This endorsement strengthens the foundation for tokenised commercial property vehicles. 

Liquidity, Transparency and Secondary Markets

 

Traditional private real estate funds impose lock-in periods that can extend beyond five years. Secondary transactions require bilateral negotiation and often involve discounts. Tokenised retail assets aim to improve this structure by enabling peer-to-peer transfers, subject to regulatory restrictions. 

The World Economic Forum estimated in a 2020 report that tokenisation could unlock trillions of dollars in illiquid assets by 2030. The report highlighted real estate as a primary candidate for digital transformation due to its fragmented ownership and documentation complexity. 

Blockchain-based registries create immutable transaction histories, which can simplify due diligence. Investors gain visibility into cap tables, rental income flows, and transfer records. Asset managers can integrate performance dashboards with blockchain data feeds, reducing reconciliation costs. 

Liquidity remains contingent on market depth and regulatory approvals. Platforms must obtain broker-dealer licenses, comply with anti-money laundering requirements, and, where required, restrict participation to eligible investors. As regulatory clarity improves in jurisdictions such as the United States, Switzerland, Singapore, and the European Union, secondary trading volumes are expected to expand within legal frameworks. 

Integration With Broader Retail Real Estate Strategy

 

Tokenisation does not replace traditional underwriting discipline. Investors continue to evaluate tenant credit quality, lease duration, location fundamentals, and footfall metrics. Retail performance data from publicly listed real estate investment trusts reinforces this focus. For example, Simon Property Group reported total revenues of US$5.7 billion in 2023, according to its annual filing, supported by high occupancy rates across its premium outlet and mall portfolio. Stable operational metrics underpin investor confidence in income-generating retail assets. 

By embedding these assets within tokenised structures, sponsors can widen their investor base while preserving operational oversight. Developers can recycle capital more efficiently by selling fractional interests instead of divesting entire properties. Institutional investors can construct diversified exposure across geographies and tenant categories through digital allocations. 

A Structural Shift in Commercial Real Estate Capital Markets 

Tokenised retail assets and fractional store ownership align technological capability with capital market demand. Blockchain infrastructure delivers programmable compliance, automated income distribution, and improved transparency. Institutional adoption by firms such as JPMorgan and BlackRock signals that digital securities have entered mainstream financial architecture. 

Retail real estate continues to offer durable income streams anchored in physical locations and brand ecosystems. Tokenisation enhances access to these cash flows without altering the fundamentals of asset quality and tenant performance. As regulatory frameworks mature and secondary markets deepen, digital ownership structures will likely integrate into core commercial real estate strategy. 

Investors who understand both property fundamentals and digital capital markets infrastructure can capture the efficiency gains of this model. Retail assets have always represented tangible economic value. Tokenisation enables that value to circulate more quickly, with greater precision, and with global reach.