Establishment of a Real Estate STO Fund for Tokenization of Silent Partnership Equity Interests

Dec. 19, 2022
Digital Securities Preparatory Co., Ltd.
Ownership Co., Ltd.
The Joyo Bank, Ltd.
Marubeni Corporation

Digital Securities Preparatory Co., Ltd.*1 (hereinafter, “DS”), in which Marubeni Corporation (hereinafter, "Marubeni") has invested, and Ownership Co., Ltd. (hereinafter, “OS"), a system subsidiary of DS, have established a real estate STO*2 fund for qualified investors as of December 16, 2022 with the aim of pursuing tokenization of silent partnership equity interests using “Ownership”, a blockchain system developed by OS, after renga No. 0 LLC established by DS submitted a notification of Specially Permitted Businesses for Qualified Institutional Investors, etc.*3

(1) ASSETLEAD Inc., a shareholder of DS, sold the property, (2) The Joyo Bank, Ltd., which has invested in DS through J-Raise Investment Limited Partnership, a CVC (Corporate Venture Capital) fund, provided a non-recourse loan*4, and (3) Mizuho Marubeni Leasing Corporation, a 50% owned subsidiary of Marubeni Corporation, participated as a qualified institutional investor.

Real Estate STO Fund Structure Real Estate STO Fund Structure

This is the first initiative in Japan to establish a real estate STO fund in which silent partnership equity interests are converted into security tokens. The five companies will strive to achieve next-generation real estate securitization products offering that contribute to stable asset building, in order to soundly promote the government's “shift from savings to investment” policy.

*1 DS is preparing to launch its real estate STO business, which will allow real estate to be converted into security tokens using blockchain technology, with the aim of providing next-generation financial products that will enable anyone to become a wealthy person.

*2 Real Estate STO (Security Token Offering) business
STO is a method of raising funds by issuing “security tokens” (digital securities) that are issued electronically using distributed ledger technology represented by blockchain technology. Real estate STOs are digital securities whose underlying assets are real estate or rights related to real estate and are attracting attention as a next-generation financial product that differs from conventional real estate securitization products.

*3 The establishment of the fund was conducted as a preparatory act for accreditation of the Testing of New Technology Demonstration Plan based on the Act on Strengthening Industrial Competitiveness (the so-called “Regulatory sandbox system”). The certification was granted on October 14, 2022. 

*4 A non-recourse loan is a method of providing a loan secured solely by assets held by the borrower.

Company Overview
Name: Digital Securities Preparatory Co., Ltd.
Founded: November 12, 2020
Representative: Kohei Yamamoto
Location: 4-15-1, Akasaka, Minato-ku, Tokyo 107-0052, Japan
Business: Preparing to launch Real Estate STO business
Website: https://digitalsecurities.jp
Name: Ownership Co., Ltd.
Founded: October 1, 2021
Representative: Haruhiko Matsui
Location: 4-15-1, Akasaka, Minato-ku, Tokyo 107-0052, Japan
Business: Developing and operating a security token system
Website: https://www.ownership.jp/
Founded: March 27, 2000
Representative: Tadashi Kitada
Location: ShinjukuNomura Bldg 9F. 1-26-2, NishiShinjuku, Shinjuku-ku, Tokyo 163-0509, Japan
Website: https://assetlead.co.jp/
Name: The Joyo Bank, Ltd.
Founded: July 30, 1935
Representative: Tetsuya Akino
Location: 5-5, Minami-machi 2-chome, Mito, Ibaraki 310-0021, Japan
Website: https://www.joyobank.co.jp/eng/
Name: Marubeni Corporation
Founded: December 1, 1949
Representative: Masumi Kakinoki
Location: 4-2, Ohtemachi 1-chome, Chiyoda-ku, Tokyo 100-8088, Japan
Website: https://www.marubeni.com/en/

Mr. Yamamoto, Digital Securities Preparatory Co., Ltd.