Johnny Sandelson has launched a new company that, using blockchain technology, will allow members of the public to buy a stake in iconic London assets including Lord’s cricket ground for as little as £500.
New Commonwealth is calling for registrations of interest to acquire shares in two properties, including a circa two acre strip of land owned by Charles Rifkind’s Rifkind Associates that runs along the Nursery End of Lord’s, NW8. The second asset is Meyer Bergman’s 103 Mount Street, W1, the Mayfair home of high-end French fashion brand Céline.
Sandelson, a founding partner of Westbourne Capital Partners, which is separately planning a residential development at The Landseer, by the Lord’s cricket ground, said of the new venture: “I’m a property entrepreneur, we’re testing the parameters of what’s possible and once we’ve established that we’re going to come back with a formal offer.”
With the Lord’s offer, there is a recognition that investors will have to wait at least a generation before profiting from a potential development opportunity at the site, after Lord’s owner MCC voted in September against approving Rifkind Associates’ proposals for a luxury residential development on the land that included a £150m payment to the club that supporters argued could be used to carry out improvement works.
However, it is expected to be attractive to cricket fans around the world. Investors in 103 Mount Street will receive rental income from the asset.
Sandelson said: “A huge number of Asian shoppers come to London every year, get on the train to Bicester to buy themselves a handbag. Next time they might want to come into Mayfair and buy a piece of the building with a big brand in it and not bother.”
The investment opportunities are due to formally launch in two weeks with more properties added in the coming months.
Each property will be put into a regulated fund that people can buy into for a minimum of £500. Once an investment threshold has been reached for each asset, it will be “tokenised” with asset-specific tokens created that can be exchanged on a platform, allowing owners to easily trade their shares.
The venture is being pitched as a “disruptive business model” that allows “the common man” to own iconic London assets through the use of blockchain in real estate technology.
Sandelson said: “Blockchain is just a very efficient database which allows us to communicate directly to 100,000 people, or however many people want to take us up on our invitation to come and invest in these properties.
“It allows us to communicate through the app, and say, this is the latest rent review, the rents have gone up, you’re going to receive a bit more money. So it’s a very efficient way of collecting information, writing it in a ledger, and storing it indelibly forever.”
The company will take a transaction fee from the seller. People who buy into an asset such as Lord’s will receive an asset-specific souvenir such as a certificate of ownership and a Royal Mint coin.
The venture is supported by former England cricket captains David Gower and Allan Lamb, and former MCC chief executive Keith Bradshaw.
Gower said: “We have no idea, no-one has an absolute concept of how many people will think it’s a great thing to be the owner of a part of Lords but I think and I’m optimistic that around the world there is a fan base for the ground as it is, there could be an extraordinary number of people who want to buy in.”
He added: “We are all on side with Lord’s, we are all on side with the MCC, this is not about challenging what happened last year, this is about continuing to view Lord’s as something very special.”
What is Blockchain?
Blockchain is software that allows users to transfer digital assets from peer to peer without using a third party. When contracts are exchanged the transaction is recorded on an immutable ledger which is distributed among users.
How can it be used in property?
Manchester-based HS Property Group recorded the UK’s first residential property sale in March using blockchain technology. The company used the Clicktopurchase platform, which facilitates the exchange of electronic contracts, to sell a four-bedroom HMO investment property in Oldham, Greater Manchester.
Blockchain can also be used for smart contracts, which allow you to automate certain functions and can create a property registry.
Listen to an interview with Ragnar Lifthrasir, founder of the International Blockchain Real Estate Association and blockchain software company Velox.RE
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