Real Estate Tokenization Could Reach Four Trillion Dollars by 2035: Deloitte

Real estate is set for a major shift as blockchain-based asset tokenization gains ground. Tokenization transforms physical and financial assets into digital units, making it easier for investors to trade fractional shares on digital platforms.

Good to know:

• Deloitte forecasts tokenized real estate to grow to four trillion dollars by 2035 from under three hundred billion dollars in 2024.
• Tokenized loans and securitizations are expected to form the largest part of the market at over two trillion dollars.
• Private real estate funds are projected to represent a one trillion dollar opportunity through tokenization.
• New projects like T-RIZE Group’s tokenized residential development in Canada highlight early adoption.
• Tokenization can allow for customized real estate portfolios based on factors like sustainability or location.

In a new report, the Deloitte Center for Financial Services is expecting the tokenized real estate market to grow from under US$0.3 trillion in 2024 to US$4 trillion by 2035, driven by a 27 percent annual growth rate.

The biggest gains are predicted in tokenized loans and securitizations, forecasted to reach US$2.39 trillion. Tokenized private real estate funds could hit US$1 trillion, while under-construction projects could add another US$50 billion.

Kin Capital plans to launch a US$100 million real estate debt fund on the Chintai blockchain in 2025, showing how new fund structures could offer faster asset servicing and secondary trading.

Tokenization could allow investors to create custom portfolios, a step beyond traditional real estate investment. Customization might focus on asset sustainability ratings or locations near airports.

Securitized Products and Infrastructure Deals Evolve

Companies like Redwood Trust and Figure Technologies are already applying blockchain to securitized loans, achieving faster reporting and lower costs. Figure Technologies estimates savings of about US$850 for every US$100,000 mortgage processed on blockchain.

Infrastructure projects are another growing area. In 2024, T-RIZE Group signed a US$300 million deal to tokenize a 960-unit residential project in Canada, while an India-based fund aims to invest US$1 billion into tokenized global data centers.

Opportunities and Risks Ahead

Tokenization brings new options but also new risks. Blockchain platform choice, asset custody, taxation, and cybersecurity all demand careful consideration. Companies must ensure smart contracts are well-structured so lenders can access real-world assets if needed.

With regulatory clarity improving worldwide, tokenized real estate is moving closer to mainstream adoption. Firms willing to adapt early could benefit from greater flexibility, liquidity, and efficiency in managing real estate portfolios.