Real estate

Market state

RWA.xyz recorded $202.63m of distributed value and $279.84m of represented value in tokenised real estate on 25 July 2026, across 104 assets in 11 countries held by 18,640 addresses. Both series were flat over the preceding 30 days and holder numbers fell 1.37%, making this the slowest-moving of the major categories.

Platform concentration is high: Reental at $80.2m across 58 assets in Spain, Mexico, the United Arab Emirates and the United States; Groma at $68.6m in a single asset, GromaCoin for the Groma Real Estate Trust on Base; DigiShare at $20.0m for the PRPTY token over a Land Invest Corp portfolio on Ethereum; Securitize at $16.3m for Preservation Fund II on Ethereum; and Ctrl Alt Solutions with World Islands Dubai properties on the XRP Ledger and MANTRA.

These figures understate the global picture because Japan's security-token market, which is predominantly real-estate-backed, is tracked separately. Progmat, described as Japan's largest security-token platform with roughly 63% of cumulative domestic issuance, announced on 25 February 2026 that it would migrate more than $2bn of tokenised assets - including real-estate-backed securities and corporate bonds - to a dedicated Avalanche layer-1, with migration completed by the end of June 2026. It reported having facilitated more than ¥216.9bn of tokenised assets to date against roughly ¥439.6bn of assets under management in the Japanese digital-asset market.

Market structure

The standard structure is a jurisdiction-specific vehicle - a Spanish or US limited company, a Massachusetts trust, a Japanese trust beneficiary interest - whose equity or beneficiary interests are tokenised. Rental income is distributed to token holders on a schedule set by the operator, and the operator also performs property management, leasing and refinancing.

Primary distribution is retail-facing on several platforms, which explains why holder counts (18,640) are large relative to value ($202.63m) - the opposite pattern to tokenised funds. Average position sizes are correspondingly small.

Secondary trading is thin to non-existent. Where a venue exists it is usually the issuing platform's own bulletin board or a licensed alternative trading system with sporadic activity, so valuations move on periodic appraisals rather than transactions. Japan is the exception in scale but not in liquidity: Progmat's volumes come from primary issuance by trust banks and securities firms, distributed to domestic investors and held.

The economic case rests on divisibility and administrative cost rather than on liquidity, and the data are consistent with that: the category has grown by adding properties, not by increasing turnover.

Risks

Illiquidity is structural, not transitional. There is no continuous market, so a holder needing to exit depends on the platform finding a buyer or on the vehicle refinancing or selling the property.

Valuation is appraisal-based and lags. Reported values in this category were unchanged over 30 days to 25 July 2026 - an absence of price discovery rather than evidence of stability.

Operator dependency is acute. A single company handles origination, property management, distributions and the register; its failure would leave token holders asserting claims against an SPV in a foreign jurisdiction. Title and enforcement depend entirely on the local land registry, which the token does not replace.

Additional exposures: property-level leverage that sits senior to token holders; currency mismatch where the property and the token are denominated differently; concentration in single assets, with the two largest platform entries each backed by one portfolio; and taxation of rental distributions that varies by investor jurisdiction.

Regulatory treatment

Tokenised property interests are securities in most jurisdictions and are offered under private-placement or small-offering exemptions rather than as prospectus-approved issues. Retail distribution therefore depends on national carve-outs.

Japan has the most developed regime: security tokens fall under the Financial Instruments and Exchange Act, with trust beneficiary interests in real estate the dominant asset. Progmat operates as the issuance platform for trust banks and securities firms, and the Japan Security Token Offering Association sets self-regulatory standards.

In the European Union, offerings sit under national prospectus exemptions with MiFID II and AIFMD applying to instruments and vehicles; the Commission's 4 December 2025 DLT Pilot Regime proposal, which would raise the issuance ceiling from €6bn to €100bn and extend eligibility to all MiFID II securities, is the main route to a functioning secondary market.

In the Gulf, tokenised property has advanced through ADGM and Dubai's regulatory framework, with Ctrl Alt's Dubai issuances on the XRP Ledger and MANTRA the visible examples. The United States remains the most restrictive for retail access, with most offerings limited to accredited investors under Regulation D.