Written by Sergey Ponomarenko
The commercial real estate industry operates with a healthy dose of logistics, red tape, and supporting roles. Many of these factors are put in place to protect investments and make sure projects run in a smooth financial and legal fashion.
Underwriters, agents, and every position in-between ensures this smooth process. But these roles all will change over the next five years thanks to a piece of technology from the FinTech industry, blockchain.
A distributed database, blockchain maintains a continuously growing list of ordered records called blocks. Each block contains a timestamp and a link to a previous block. By design, blockchains are inherently resistant to data modifications.
For example, once the data is recorded, the data in a block cannot be altered retroactively. As a result, blockchains are an open, distributed ledger, recording transactions between two parties efficiently and permanently.
Many of the tech players in the proptech industry in Silicon Valley, Calif., are using blockchain in residential real estate transactions, and it’s coming quickly to commercial real estate. Unlike LoopNet, CoStar, or other listing sites, this technology actually allows the transaction to close without all of the red tape.