In March 2012, we founded Loadstar Capital K.K. with an ambition to revolutionize Japanese real estate investment. Our first office was located in a small building in Ebisu, Tokyo. We started real estate consulting business in a one-room, 12-tsubo (40 square meters) office and later expanded the business to include brokerage business and principal investment business.
The first turning point came in March 2014. With an injection of funds from the Renren Group, which was listed on the New York Stock Exchange back then, we have been working to unite real estate and IT—that is, to introduce real estate technology—to shake up the old world of real estate transactions.
In the real estate investment industry up until then, there was a clear distinction between the area mainly for institutional investors and the area for individual investors due to differences in funding power, volume of information, and networks, etc. Thus, individual investors could not access investment properties for institutional investors. In addition, as securitization of real estate had progressed in the real estate investment industry for institutional investors, the industry faced strict regulations, resulting in difficult market entry. For this reason, players in this industry have been limited to institutional investors, leading to an unstable market that is easily influenced by the economic conditions.
We wanted to free up this situation by using technology and lower the barrier to real estate investment, with the aim of contributing to the sound development of the real estate market.
Our challenge to Real Estate Tech started from September 2014 where we entered the crowdfunding (social lending) business. Crowdfunding is a mechanism to raise capital from an unspecified large number of people via the Internet. We believe that this method of gathering relatively small amounts of funds from a wide base has a high degree of affinity with real estate investment.
For a long time, investment and asset management in Japan have been viewed in a negative light. Real estate investment in particular requires large amounts of capital and has been limited in most cases to the wealthy. Our role is to create a new world of asset management by lowering such barriers to real estate investment through technology.
We also hope to communicate through crowdfunding the appeal of real estate investment to the younger generation in their 20s and 30s. We provide a forum for learning, so that people will accumulate knowledge and familiarity in investing by starting to manage assets early in their lives. Numerous individual investors have embraced this real estate investment crowdfunding system, which we named “OwnersBook,” as a new platform for asset management since its launch. Indeed, the cumulative investment through “OwnersBook” had topped 39,900 million yen as of June, 2023.
In the world of real estate, especially in areas for business use such as offices and commercial facilities, major real estate companies, developers, and others like them have monopolized information for a long time. Thus, the value of real estate has been determined by such players, based on their rule of thumb regarding tenant quality, grade of buildings, level of rents, and other such factors.
What if we could create a system where individual investors could access the insights of real estate investment professionals? We have offered transactions on "OwnersBook" and provided information, related to the transactions, from the real estate professional's perspective. We realize that this is not an easy task to accomplish in a single step. However, we believe that by continuing this steady effort and involving as many people as possible, we can increase the transparency of the real estate market, thereby creating a win-win-win market for the real estate market, investors, and us.
We think that crowdfunding has limitless potential. While “OwnersBook” is a platform limited to real estate investment, we are certain that not too distant future, the day will come when even massive projects such as urban development will be undertaken through crowdfunding. We hope to work with individual investors to create that kind of world of new asset management.
Our long-term vision of "Open up the real estate investment market to individuals" is an initiative to fundamentally revolutionize the real estate investment industry, mainly through "OwnersBook.” In order to open a new door to the industry while also expanding Corporate Funding and Asset Management Businesses, it is essential that we streamline operations by utilizing data and digital technologies, that our executives and employees have strong wills to achieve our vision, and that we establish an organization that underpins such efforts. While implementing robust cyber security measures, we, Loadstar Group, continue striving to promote and enhance digital transformation across the company through in-house system development, ICT utilization, and investment in human resources and facilities, based on the data and knowledge that we have accumulated over the years.
In the near future, there is no doubt that utilizing data and digital technologies will continue to advance in the real estate industry. Beyond that, however, nothing will change in the importance of human ability, such as building relationship of trust with business partners, and demonstrating sensitivity and adjustability in the real world.
We are committed to creating a more open, flexible, and sound real estate investment market by integrating technology into this complex real world.