Fractional Ownership is an investment approach in which the cost of an asset is split between individual shareholders. Investors looking to enhance their wealth face a variety of competing economic obstacles right now. For starters, rising inflation puts pressure on investors to purchase assets that will increase in tandem with it. At the very least closely track it. Failure to do so would result in a decline in real-term wealth, which is antithetical to the goals of every would-be investor.
Great strides in fractional investing platforms like Gak Group are allowing retail investors to engage in institutional-grade investments that they would not have qualified for in the past. As well as gain the benefits of direct property ownership without the accompanying frictions and difficulties.
An Elusive Asset Class: Real Estate
Real Estate, as an asset type, is famously expensive. Property investing has always been a successful vehicle for financial gains. But it remained unavailable to ordinary people until recently, owing in large part to the initial cash necessary to join.
Its unblemished track record of capital appreciation and market stability is difficult to argue with.
This provides investors with unique protection, since they may be confident that the real-terms worth of their assets will not be decreased by inflationary pressures.
However, for far too long, ordinary investors have been hampered by entrance obstacles – industry expertise and upfront funds – that limit participation in the lucrative property development business.
Fractional Ownership Explained
As the name implies, fractional investing allows investors to put money into an asset without having to put up enough money to buy the asset altogether.
This simple yet groundbreaking strategy allows investors to benefit from the same features as the entire offering at a fraction of the cost.
In other words, rather than committing the needed complete money, investors can just put in a lower amount and gain exposure to the underlying assets growth in value.
Furthermore, thanks to this increased disintermediation. Investors may align their interests with experts like Gak Group who have the requisite competence and can execute the necessary due diligence and monitoring on their behalf.
Why Should Investors Take Part in Fractional Ownership?
- Dual Returns: Investment in commercial real estate generates a twofold return. The benefits of fractional ownership include both immediate financial gains and the value of a commercial property.
- Rental Income Returns: Commercial estate fractional ownership provides a high return on investment due to ongoing rental revenue and appreciation. Over the previous five years, commercial property investment in India has expanded at a CAGR of 16%.
- Long term lease: Renters in rental units change regularly. As a result, the landowner is obligated to pay the rent until a suitable substitute is found. Commercial leases are frequently 3 years or longer. The leasing arrangement is also renewable.
- Liquidity: Liquidity is a significant advantage of fractional ownership. Traditional real estate investments have lesser liquidity than fractional property assets.
- Versatility: Do you wish to diversify your real estate assets but lack the funds to purchase properties in other markets? Real estate fractional ownership enables this. You may then decide whether to focus on a certain industry or to continue diversifying. And profiting from economic ups and downs.
- Strength: Due to portfolio diversification, ease of departure, financial gain, and continuous rental income, small investors are becoming fractional owners of commercial buildings. Furthermore, the Indian commercial real estate market is expected to increase from 13-16% soon. Making fractional ownership of commercial buildings a beneficial investment.
GAK Group is a well-known real estate investing platform in India that offers chances in Chennai, Hyderabad, and Bangalore. It offers practical commercial space investment options such as fractional ownership for as little as Rs.25 lacs and crowdfunding.
Also Visit: Asset Yantra for investment. Asset Yantra is also a well-known real estate investing platform in India that offers chances in Chennai, Hyderabad & Bangalore.