Real Estate Group Magnum accepting Bitcoin as a mode of payment
Potential buyers can now buy real estate globally with Bitcoin as Real estate group Magnum is opening Bitcoin payment options for retail estate properties.
According to the South China Morning Post, Magnum Real Estate Group has accepted Bitcoin as payment for the $29 million sales of three ground-level shops at a luxury residential project in Manhattan. With an estimate of $29 million, the property is worth around 641 BTC at current exchange rates. The stores situated at 385 First Avenue, known as CODA, are 9,000+ square feet and are at present leased to M&T Bank, Mighty Pita Restaurant, and ProHEALTH Urgent Care Clinic.
Ben Shaoul, managing partner of New York-based Magnum said, “We are a pioneer in Bitcoin transactions and see a path where many more transactions can be done using blockchain.” According to Shaoul, any future resale of retail space can be made in foreign currency, depending on the buyer's preferences. Magnum also sold some of the apartments above the retail space for cryptocurrency.
Crypto payments gain traction for real estate purchases, thus becoming another notable way for people to invest their Bitcoin.
Recently several crypto holders have started investing their cryptocurrencies and Bitcoin into less risky assets such as real estate. The managing partner of Magnum Real Estate Group, Ben Shaoul, said that the firm has recently received several requests to sell real estate to cryptocurrency holders.
Magnum began accepting crypto payments for real estate transactions about three years ago. Shaoul exclaims, “With the help of our legal team, we figured out how to conduct crypto transactions with the consent of regulators. We first sold a few residential units, and then we sold a retail condominium in New York about three years ago for cryptocurrency.”
A special consultant for Magnum and the chief operating officer of Jet Real Estate, Eric Hedvat, says that due to the fast-paced growth of today’s crypto market, bitcoin payments for real estate has become more important than ever since it offers crypto investors an added opportunity to grow with cash flow. He further said, “The cryptocurrency market has created a vast network of new wealth that wants to find traditional assets to invest in like real estate. There also aren’t many commercial properties for sale to buy with Bitcoin.”
Magnum had sold a retail condominium building for $15.3 million in bitcoin during 2019. He found that the income generated was all credit. “M&T bank has been a tenant in this building since it was built. They are a multi-billion-dollar bank.”
Shaoul further exclaims that people who have created new wealth with cryptocurrency don’t have a way to monetize it or create a steady income stream. Adding to this, he said, “This property has over a million dollars a year of free cash flow. This is a very attractive offering for someone sitting on the wealth they’ve created in cryptocurrency. This allows them to monetize and effectively collect a bond moving forward.”
This has become the scenario due to interest rates in the U.S. A recent survey found that the Federal Reserve might have to raise the U.S. interest rates at least twice by the end of 2023 due to the elevated inflation.
CBW - External Analyst