Basis for blockchain in real estate established
Letting and selling space will be cheaper and more efficient in the future.
Deloitte, together with the municipality of Rotterdam and the Cambridge Innovation Center (CIC), is the first to develop a system, based on blockchain technology, that can process rental contracts safely and quickly.
19 mei 2017
For decennia, the drafting, registering and managing of rental and sales contracts for residential and commercial property has been a labour-intensive, costly job. This led Deloitte, the municipality of Rotterdam, and the CIC to develop a digital system over the last few months that makes this quicker, more reliable and more efficient. The technology behind the system, blockchain, ensures fast and safe registration and exchange of data in a shared database. The parties involved (surveyor, real estate agent, buyer, seller, bank and the land registry office) can all make use of the same up to date information at a lower cost.
Digital revolution in the real estate sector
Deloitte sees the combination of blockchain technology and real estate as an important focus area. Jurriën Veldhuizen, managing partner Deloitte Real Estate: “We believe, together with real estate decision-makers, that blockchain is going to create a digital revolution in the real estate sector. Blockchain in the real estate sector increases the feeling of trust between the different parties because data is saved in a transparent way and the risk of mistakes in information decreases. The application we have developed, lays the foundation for developing new business models and applications for the real estate sector, but also for other sectors. For consumers it means that the transaction costs for renting, and especially for buying property can be significantly lower than they are now. We want to further build on this in the various partnerships.”
Municipality of Rotterdam helping to accelerate
The municipality of Rotterdam has actively contributed to the development. A necessary contribution, says Maarten Struijvenberg (Councillor Economy): “Real innovation is achieved when you dare to stick your neck out. When you really want to change the whole chain, rather than just update the status quo a little. This is an example of that.” Struijvenberg sees a role for the municipality of Rotterdam in the early stages of development: “As a municipality, we are part-responsible for shaping the new economy. I am therefore very keen to help accelerate these kinds of developments, at least past their infancy stage.”
The most logical place for far-reaching innovation
Melissa Ablett of the Cambridge Innovation Center Rotterdam is also keen to contribute: “This fits perfectly with our company philosophy. We have over 100 large and small innovators who rent spaces with us on a flexible basis. These companies embrace new technology. CIC’s motto is improving the world through innovation. The blockchain solution Deloitte is presenting suits this motto perfectly. And, furthermore, a blockchain platform offers opportunities for a substantially lower cost base for a company such as CIC.”
Code name ‘Blockchain in Real Estate’
Under the code name Blockchain in Real Estate, Deloitte and the municipality of Rotterdam developed a platform to process rental and other real estate contracts fully digitally. By using the blockchain technology, a uniform source of real estate information is established for different stakeholders to use, making multiple checking of the same data unnecessary. The system is a first proof-of-concept and is based on blockchain, the decentralised technology behind, for example, Bitcoin.
As a part of the Roadmap Next Economy, the real estate sector is one of the sectors in which the municipality of Rotterdam is working with commercial partners on real innovations, that truly step away from the old way of working. Besides real estate, this is also happening in the financial sector and in transport & logistics. It should make doing business easier and more efficient. The new technology supports innovations in ways that were previously not possible. In this regard, the partners in Rotterdam are leading the way.