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Changing Traditional Property Investments

DURISE is the first company to introduce real estate crowdfunding to the Middle East, launching its services online to all real estate investors in the region and to who wish to invest in the Middle East real estate market through crowdfunding. Waleed Esbaitah, CEO, DURISE talks us through their unique concept in offering an alternative, simple way of investing in real estate via a crowdfunding platform.

Could you give us a brief background about DURISE? How did you get started?

Durise is the Middle East's first real estate crowdfunding platform. Crowdfunding is the act of joining funds online for a specific cause. There are several types of crowdfunding, equity baring, charitable, or grant style funding. What we are offering, is equity crowdfunding, the opportunity for you to place your funds with other people to purchase a real estate asset for investment purposes.

This was the natural direction our team felt the real estate industry was taking. All around the world, people are making a move to control their own assets and investments, as opposed to entrusting another individual to do so. We narrow down the choices to those that we think will be the most profitable, and then offer them to you to invest in with the utmost ease. It is much more convenient to make an investment over the internet, and now we wanted to offer the best industry Dubai has seen, to people around the world.

How unique is your concept to the Middle East?

As mentioned earlier, we are the first company to do this specific activity. Real estate has long been this city's main source of income. Even the tourism industry, in some ways, is a real estate play. That being said, we are the first to streamline the process of involvement. Previously, one would have had to be wealthy, save up, or borrow money to purchase real estate. Now, money that would have been spent on a luxury good or a trip, could be invested in a property, offering a passive income, and offering a capital gain at the end of the duration.

How do you assess the real estate investment market in the UAE?

We keep a close eye on the market and the current prices. We constantly measure the progress of the market, to make sure we are well priced and do not overcharge our investors. We look at comparables frequently to be as accurate as possible. Moreover, we employ a third party valuation company, called Cavendish Maxwell that offers a secondary perspective on all properties we offer.

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What is the idea behind real estate crowdfunding investment that DURISE is adopting in this country?

The idea here is to make an industry that has always been the pillar of wealthy individuals' portfolio, accessible to the general population. Real estate has many benefits, but by nature, it is difficult to take part in. By selling tickets at a price of $5,000 per ticket, we have made it more accessible and manageable to a larger group of investors. Simultaneously, our platform offers the ease of investment, by clearly displaying available investments, allowing even the most seasoned investor to use it for its simplicity and ease of use.

What are the risks associated with property crowdfunding?

The risk is very minimal. You are investing in a tangible asset, which has a value that fluctuates at a healthy rate. The very worst-case scenario, is that the returns aren't as high as one would expect. That being said, if you invest in the right areas, there is always room for profit. This is much safer than investing in the stock market or individual companies, as they do not offer the safety that real estate does. The only real risks are severe political instability, or some accident occurring to the asset, but even then, we insure all our properties.

What opportunities does real estate crowdfunding offer to investors?

Real estate crowdfunding offers investors the opportunity to diversify their portfolio and decrease their risks. Also, it offers individuals a passive income, an annual return to increase the funds available to them to either spend or reinvest, without the value of their ownership changing. All the while doing so through a transparent and easy to use portal accessible from any country around the world.

What is the rate of returns that investor in a property crowdfunding should expect?

There isn't a specific rate of return to expect, because crowdfunding real estate allows investors to take part in various real estate projects in different sectors, at different stages of construction, in different areas, and all with various timeframes and risk. This is the reason why it's easy to diversify, because now, instead of placing all your investments in one property, you can spread them across a bouquet of assets that have different returns and different payment schedules.

How is this practice evolving on both global and regional levels?

This practice is increasing at an exponential rate. The real estate crowdfunding industry alone, without taking into account all funds spent on other crowdfunding platforms, has increased from $1 billion last year, to a forecasted $2.5 billion in 2015.

How do you plan to move forward with crowdfunding in the region?

We have many plans for the company that will only increase our market share. Some of the things we plan to do, is open up our investments to more and more investors from around the world, by abiding the laws of various jurisdictions, including the US, and many other European countries. Also, we plan to expand our business to allow investors to take part in real estate developments at an early stage. This is more risky than investing in a ready asset, but will prove to be much more lucrative. If and when we choose the right investments, that risk will be mitigated by applying different measures.

About Waleed Esbaitah
Waleed Esbaitah is the CEO and Founder of DURISE. He is an entrepreneur with an international outlook.

After interning with real estate consulting and capital management firms in the US and the UAE, he began his own start-ups, some of which received considerable success and external funding.  These include bubbl.me , a project based on the concept of microblogging through snipping videos from the web, and studentinternnetwork.com , a network aimed at connecting students to internships.

By 2014 Waleed had already established DURISE, a concept he had been researching for some time. 

Waleed has a degree in Finance from George Washington University in the US.

© Capital Business 2015

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