ARA Asset Management announced a joint acquisition of crowdfunding platform Minterest in a broader ambition to up fintech capabilities and develop a global real estate credit business.
Along with tycoon owner John Lim’s family office and the group’s property management arm, 52.08 percent of Minterest was jointly acquired at an undisclosed sum.
Minterest was established in 2016 as a Singapore-based fintech firm and has since originated loans of over $60 million in the city-state.
According to a joint statement, crowdfunding will enable developers to access working capital while simultaneously providing investors with real estate exposure outside of physical property or REITs without putting up large sums of capital.
New Product
The statement also noted the planned launch of a new real estate secured mezzanine debt financing product in mid-May by way of co-investing with Straits Real Estate (SRE) in a 64-level high rise residential project in Melbourne.
«The robust credit scoring process and system that Minterest has in place enables us to reach out to investors directly and efficiently, aided by technology,» said Lim. «With the successful launch of the first real estate product on the Minterest platform, in partnership with SRE, ARA will leverage the platform to offer more real estate products in the near future.»
Crowdfunding Growth Leader
An EY report in March 2019 called global real estate the fastest crowdfunding segment, forecasted to grow by 18.5 percent per year to $9 billion by 2021. ARA’s joint statement suggested more acceleration as the pandemic will further benefit defensive asset classes like real estate.
As of 2019-end, ARA had $62 billion in assets under management (AUM) with real estate investments spanning across REITs, private real estate funds and infrastructure funds in 28 countries. Most recently, it also acquired a majority stake in London-based debt specialist Venn Parnters which had $6.2 billion in AUMs.
