The first time most Canadians heard the term “non-fungible tokens” was likely after a recent blockbuster Christie’s auction for a piece of digital art. However, experts expect the technology to move far beyond the art world into everyday life – though nobody knows for sure how they will be used.
NFTs – which are essentially a tool that uses blockchain technology to provide proof of ownership of a digital asset such as an image, audio clip or a tweet – are currently a fringe item used primarily by tech enthusiasts and artists, but experts say potential uses for the tokens are nearly limitless, including the proof of ownership of assets such as cars, real estate or just about anything of value.
A non-fungible token is certified on the blockchain (the same technology that ensures the security of cryptocurrencies like Bitcoin), and whoever owns the NFT is deemed the original owner of the asset.
Earlier this year, a digital collage by the artist Beeple fetched a final bid of over US$69 million for digital ownership through an NFT. And Jack Dorsey, the CEO of Twitter, auctioned his first-ever tweet as an NFT, with the final bid coming in at US$2.9 million.
But experts say there’s more to NFTs than art and online memorabilia.
“There’s literally no limit,” said Andreas Park, an associate professor of finance at the University of Toronto who specializes in blockchain technology. He said the advent of NFTs could change how we think about ownership, the same way the internet changed how we consider communication and commerce.
“There’s a large variety of ways we can use this in the digital world, some of these I can’t imagine now,” he said. “It’s like the internet – people couldn’t really envision any way you could use it profitably for a while, and then all of a sudden we came up with a lot of solutions like paying over the internet.
“You could tokenize almost anything if you have a legal structure that would have a formal guarantee for something that isn’t living in the digital world that can be linked to a token,” he added.
With a legal framework, Park said NFTs could be used to signify ownership of a car or a piece of real estate. With self-driving cars in the future, an NFT could be used to designate shared ownership of a car and show what percentage is owned by each party, since people may not need to own the car 100 per cent of the time.
Amy ter Haar, a blockchain consultant and a lawyer with Osgoode Professional Development in Toronto, predicted that NFTs will become like a deed of electronic ownership, and the integrity of the system will be maintained by the fact that the blockchain is a secure and generally unchangeable digital record.
“It can create this permanent immutable record of who owns anything,” said ter Haar.
Both ter Haar and Park agreed that questions remain around regulatory oversight of how NFTs are created and transacted.
However, ter Haar compared NFTs to the introduction of paper money. She said people found it difficult to imagine how paper money could hold value after trading with gold for so long. But people soon realized that if society deemed the paper valuable, then it was so. The same, ter Haar said, will be true of the value of a digital asset in NFT form.
Park said government involvement could be close in the future, especially as blockchain was mentioned multiple times in the Chinese government’s recent five-year plan, which heavily features technology investments.
In the Western world, Park said tech giants like Facebook are also investing heavily in blockchain in conjunction with other corporations such as Shopify and Uber.
“It’s another component of digitizing society,” said Park.
“It’s important to think beyond what we already do have and what (NFTs) can do – they can do something you’re already doing (in creating a record of ownership), but better, and the use cases will come.”
Forest Gate buys Niagara Falls shopping centre | RENX – Real Estate News EXchange
Forest Gate Financial Corp. has acquired a Niagara Falls shopping centre as the newly formed investment firm begins building a portfolio and executing on its strategy to acquire a diverse range of properties.
The Mount Carmel Centre was purchased from a private investment group for $37 million. The 30-acre site at 3930 Montrose Rd. is occupied by a shopping centre with tenants that include Food Basics, The Sleep Factory, Tim Hortons, Swiss Chalet and Harvey’s, among several other retailers and food, beverage and service providers.
“We really believe in the Niagara Falls market and think this is an excellent opportunity for us,” Forest Gate chief executive officer and managing partner Dan Marinovic told RENX. “We like the site because it’s a very large property that we feel we can add value to.”
Forest Gate will manage the property, which is in close proximity to a residential neighbourhood and Mount Carmel Park. Niagara Falls has natural attractions, a strong tourism industry and a manufacturing base.
The city will benefit from improved GO Transit service, which Marinovic believes will make it an attractive location for people looking to work remotely while seeking a more affordable and relaxed lifestyle than can be found in larger markets.
Forest Gate seeks variety of asset classes
While there are no immediate plans for redevelopment, the Mount Carmel Centre site is large enough to accommodate future multifamily and mixed-use development.
Forest Gate is establishing a stand-alone purpose-built rental apartment vertical and Marinovic said it has close to 500 units under management or in its acquisition pipeline.
The company is looking to add at least 1,000 units annually over the next several years. It’s targeting value-add opportunities in Southern Ontario communities like Niagara Falls where there’s access to public transit and pleasant environments for living and working from home.
Forest Gate is also seeking income-producing industrial and retail properties, as well as development and redevelopment opportunities.
The Vaughan-headquartered boutique real estate private equity, private debt and advisory investment firm was launched in March by Marinovic and partner and chief financial officer Frank DelZotto to deliver premium risk-adjusted returns on its own and in partnerships with developers, builders, investors and capital providers.
Forest Gate can be nimble in making acquisitions and Marinovic is excited by the momentum the company has achieved in its first six months.
“We’re big believers in the Canadian real estate landscape, especially as things start to normalize and we get immigration back to pre-pandemic levels,” said Marinovic. “We’re looking at very significant growth over the next 12 months.”
The Forest Gate team
Marinovic was most recently chief development officer of Dream Unlimited, where his responsibilities covered finance, development, construction and operations. Before joining Dream in 2013 he was vice-president of finance for First Gulf, the commercial real estate arm of Great Gulf, for seven years.
DelZotto was previously a partner at BDO Canada LLP for 19 years.
Forest Gate just hired Justin Hawkins, formerly First Gulf’s senior manager of development and planning, as director of development. Hawkins worked for RioCan REIT, Dream and SmartCentres REIT before that.
Vaughan-based home-builder Treasure Hill Homes is a partner in Forest Gate. Forest Gate’s advisory board is comprised of Marinovic, DelZotto, Treasure Hill president Nicholas Fidei and Treasure Hill CFO Mark Caruso.
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Podcast: What triggered a record-breaking Ottawa real estate deal – Ottawa Business Journal
A record-setting residential real estate deal takes centre stage in the latest episode of Behind the Headlines.
To hear the full podcast with OBJ publisher Michael Curran and editor David Sali, please watch the video above. Prefer an audio version of this podcast? Listen to it on SoundCloud or Spotify.
MC: We know the business audience likes big numbers, and this is a big number: a quarter of a billion dollars. This is a three-building rental apartment complex in Westboro, and it sold for $267 million. We think it’s the largest residential real estate deal in Ottawa history. Dave, tell us about it.
DS: CBRE brokered this historic deal. It actually took three of their offices – Ottawa, Toronto and Montreal – working together to get this deal done. That’s how big it was. The buyer is Homestead Land Holdings out of Kingston. They already own a couple of dozen properties in Ottawa along with dozens more across the province. As Nico Zentil of CBRE’s Ottawa office told me, it is just very rare that you would see a property of this scale ever come on the market in Ottawa because we have a pretty tightly controlled market here. This is part of Homestead’s play to expand its footprint here – they also recently filed an application to build a 25-storey apartment tower with 235 units near Baseline and Greenbank. Clearly, they’re wanting to go big in what they think is going to be a big bounceback for the Ottawa rental market. Zentil said the properties were hotly pursued and got multiple bidders. That’s a testament to the strength of the Ottawa residential market right now.
As you know, last year wasn’t great for the rental market in Ottawa. With the pandemic, two big groups that are normally pretty steady, reliable renters – students and new immigrants – well, there weren’t many of those coming to the capital last year, so that caused a little bit of a dip in the rental market for sure. But the general consensus seems to be that things are ready to bounce back.
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