December 2025
Tokenization Requires Better Buildings, Not Better Blockchains Using better data architecture for intelligent tokenization
The digital standard for real estate
Building PropTech, Inc
United States of America
www.building.inc
Hong Kong SAR, China
Building Tokenization Report
Building Tokenization Report - Takeaways Building provides the data infrastructure that makes assets finance-ready, compliant, and suitable for on-chain workflows
The majority of tokenized real estate assets today are not finance-ready because their underlying data is incomplete, inconsistent, or unverifiable
The bottleneck for real estate tokenization is not blockchain scalability. It is the absence of trusted, lifecycle-long asset data
Asset managers, lenders, and capital-markets participants need structured, standardized, and continuously validated data before a building can participate in digital markets The State of Real Estate Tokenization: Of the many Real-World Assets (RWA) that can or should be tokenized, real estate assets (including land and infrastructure) have been repeatedly presented as a top priority because of the sheer size of the market, which sits at roughly $393.3 trillion as of 2024.¹ The argument tends to be that tokenizing even a small percentage of this market would move a substantial amount of value on-chain and create product-market fit.
As of Q3 2025, the total amount of tokenized real estate is estimated to be $3.8 billion,² which is equivalent to 0.001% of market share when rounded to the nearest thousandth. This amount is substantially smaller than other tokenized RWA categories. Private credit and U.S. Treasuries, for example (excluding stablecoins), crossed $35.57 billion in November of 2025.³
This raises a question that few in the industry have wanted to address directly: what is holding back real estate tokenization? And perhaps an even more important question: is the “tokenizable” market being overestimated?
Many reports also fail to specify the utility or purpose of tokenization—or how it should be measured. Tokenization of a real estate asset’s capital stack could be grouped with tokenization of a real estate deed, and both would bring value on-chain, but with widely varying functionality and purpose.
¹ Savills Impacts How Much Is Global Real Estate Worth, available at https://impacts.savills.com/market-trends/how-much-is-globalreal-estate-worth.html
² Gate Web3 Infrastructure Integration: DeFi, RWA, and AI Advancements in 2025 available at https://www.gate.com/crypto-wiki/ article/web3-infrastructure-integration-defi-rwa-and-ai-advancements-in-2025-20251118
³ Phemex Tokenized Gold Overtakes Private Credit as RWAs Hit $35.67B available at https://phemex.com/blogs/rwa-tokenized-goldovertakes-private-credit-nov-2025
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Building Tokenization Report
Identifying the Challenges The Challenges in Tokenizing Real Estate: The slow rate of real estate tokenization can be attributed to a myriad of challenges, some pre-existing in real estate and finance, and others new, introduced by the turbulent industry of blockchain.
Blockchain-specific challenges⁴:
On-chain liquidity and tokenized secondary markets are underdeveloped.
Smart contracts and blockchains carry risks related to bugs, security, and custody.
Tokens can offer more functionality than traditional securities, yet they remain subject to the same securities regulations. Digital-specific challenges⁵:
The real estate industry suffers from severe data silos and fragmentation.
Most documents are not machine-readable.
Real-estate software systems are often not interoperable.
Implementation costs for new technology can reduce Net Operating Income and negatively impact property value.
Pre-existing challenges in the legacy industry⁶:
Private real estate lacks standardized modeling and reporting.
Appraisals vary widely due to missing or inconsistent context.
Compliance and risk are often obscured and difficult to evaluate.
Real estate projects are highly complex and carry significant execution risk. Together, these challenges form a cycle that holds back real estate tokenization.⁷
⁴ Bank for International Settlements (BIS), DeFi Risks and Vulnerabilities (2023); IMF, The Rise of DeFi: Implications and Risks (2024); McKinsey, Digital Assets and the Infrastructure of Trust (2023)
⁵ KPMG, Real Estate Tokenization: Market Overview and Key Challenges (2020/2024); Deloitte, Digital Transformation in Real Estate (2023); EY, Real Estate Tokenization: A New Era for Property Investment (2024)
⁶ Phemex Tokenized Gold Overtakes Private Credit as RWAs Hit $35.67B available at https://phemex.com/blogs/rwa-tokenized-goldovertakes-private-credit-nov-2025 ⁷ World Economic Forum, Tokenization of Real Estate and Infrastructure Assets (2023); Deloitte, The Future of Real Estate Tokenization (2024); McKinsey, Navigating Digital Complexity in Real Estate (2024)
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Building Tokenization Report Blockchain issues weaken confidence in token functionality and limit liquidity. Digital-readiness problems make it difficult to convert fragmented, unstructured property data into something machines and markets can trust. Long-standing industry practices—such as inconsistent modeling, valuation gaps, and opaque compliance records—add another layer of uncertainty around the asset itself.
As these factors interact, they amplify one another: poor data quality makes digital systems harder to implement, fragmented workflows reduce the reliability of automated processes, and valuation opacity discourages secondary-market participation. Tokenization remains technically feasible but operationally fragile, constrained less by blockchains and more by the condition of the underlying assets.
Who Stands to Benefit Stakeholder
Processes
Developer
TABLE 1
isibility
Risk
Faster financing cycles; fewer revision loops
Clearer documentation trails
Fewer surprises during underwriting
Reduced delays and change-order disputes
More competitive lenders + global capital
Asset Manager
Streamlined reporting; quicker valuations
Real-time portfolio insights
More accurate performance signals
Less manual data collection
Readiness for structured products and digital markets
Lenders
Accelerated underwriting; quicker approvals
Transparent collateral profiles
Lower uncertainty premiums
Less back-and-forth with borrowers
Access to standardized deal packages
Capital Markets
Faster NAV updates; smoother integration
Transparent asset histories
More reliable pricing inputs
Reduced reconciliation overhead
Assets that qualify for securitization and tokenization
Compliance
Shorter audit cycles
Traceable version histories
Fewer gaps in compliance
Less time reconstructing records
Easier cross-border or multi-asset reviews
Regulators
More efficient oversight
Clearer transparency and reporting
Better monitoring of systemic risk
Reduced enforcement burdens
Safer pathways for tokenized markets
V
ost
C
arket Access
M
The table illustrates that, although each stakeholder experiences the challenges of real estate tokenization differently, the underlying bottlenecks are the same. Developers need cleaner documentation; asset managers need structured data; lenders need transparent collateral; capital markets need standardized inputs; auditors and regulators need consistent records. When these pieces fall into place, the benefits cascade across the industry. Faster processes, clearer visibility, lower costs, and better risk assessment are shared gains that emerge from a common foundation of complete, machine-readable, and verifiable asset information.⁸
⁸ Deloitte, Digital Transformation in Real Estate (2023)
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Building Tokenization Report These outcomes are particularly relevant today because real estate is under increasing pressure to operate at the speed and transparency of financial markets. Traditional workflows were not designed for tokenization, securitization, or real-time reporting, and the gaps between old systems and new expectations widen every year. As digital platforms, AI tools, and blockchainbased markets evolve, the demand for high-integrity asset data grows alongside them. The benefits shown in the table point toward a future in which real estate assets can reliably participate in these environments without the friction that characterizes the industry today.⁹ Seen together, the outcomes highlight a simple pattern: once the underlying data problems are resolved, the incentives for every stakeholder align. Developers gain predictability, asset managers gain efficiency, lenders gain confidence, and markets gain transparency. This alignment is what enables real estate to move from slow, fragmented workflows toward finance-ready digital assets capable of supporting tokenization, automated compliance, AIdriven analysis, and new forms of capital formation. The following sections describe how these needs can be met and how real estate can become ready for digital and on-chain markets.¹⁰
Effects on the Property When a building carries clear, structured, and continuous data, it becomes a healthier and more resilient place to live and work. Decisions aren’t made in the dark. Materials are installed correctly the first time. Mechanical systems run closer to their intended performance. The property uses less energy, avoids breakdowns, and ages with greater ease.
The people inside feel this almost immediately. Maintenance becomes proactive instead of disruptive. Air quality, lighting, and temperature stay in harmony more often. Tenants experience fewer interruptions and a stronger sense of stability.
High-quality data lets a property operate at its best. It supports sustainability goals, improves daily life for occupants, and strengthens long-term value. Buildings with reliable information function better and become better places to occupy. ⁹ World Economic Forum, Asset Tokenization in Financial Markets (2025); McKinsey, Digital Assets and the Infrastructure of Trust (2023) ¹⁰ PwC, Emerging Trends in Real Estate (2024); World Economic Forum, Real Estate Industry Transformation (2022)
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Building Tokenization Report
The Conditions for Scalable Tokenization In order for tokenized real estate to reach its projected market cap, several things need to evolve in parallel, as described below.
Blockchain-specific improvements: Clearer representation of ownership In Dubai, United Arab Emirates, VARA has begun allowing direct deed-level tokenization in controlled environments. They outline requirements for legal equivalence between a blockchain token and the underlying real-estate asset. Dubai Land Department is actively exploring blockchain-based title workflows. Better interoperability Chainlink CCIP enables secure movement of tokenized assets across chains. They are already partnered with SWIFT, major banks, and asset managers. More reliable automation Aave, MakerDAO, and Centrifuge show that smart-contract automation for real-world assets can reach institutional-grade reliability. They depend on audited, upgradeable frameworks with strict security standards. More transparent , standardized token structures ERC-3643 is a widely adopted smart-contract standard for permissioned, compliant tokenized securities. It supports KYC/AML, transfer restrictions, recovery mechanisms, etc. It’s used by major platforms like Tokeny, Securitize, and Zoniqx. Digital infrastructure improvements: Data standardization UK’s Golden Thread of Information (Building Safety Act 2022) requires structured, validated, lifecycle-long digital records for buildings. It is one of the world’s strongest real estate data mandates and sets a precedent for standardized asset documentation. Machine-readable building data ISO 19650 is a global standard for structured, machine-readable building information. It is adopted across Europe, Asia, and large US developers and forms the backbone for digital twins and automated compliance. Interoperability across systems Singapore’s CORENET X integrates regulators, architects, engineers, and constructors into a unified digital submission ecosystem and enforces interoperable data formats for permits and compliance.
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Building Tokenization Report Data provenance and version control Magma anchors documents and extracted metadata to the blockchain for immutable provenance. Continuous updates / dynamic data JLL and Prologis use digital twins to capture performance updates, maintenance states, and spatial accuracy over time. “Living” data models are seeing more mainstream acceptance in commercial portfolios. Legacy real estate workflow improvements: Valuation modernization The RICS Red Book Global Standards increases integration of digital records, sustainability metrics, and structured data, and encourages standardized global valuation practices. Duff & Phelps (Kroll) digital appraisal workflows; major valuation firms now incorporate digital data sources directly into appraisal workflows. Transparent compliance data The EU Taxonomy for Sustainable Activities requires evidence-backed reporting for building performance, energy use, and ESG compliance. This forces owners to maintain truthful, accessible data to qualify for financing. LEED v5 and BREEAM increases emphasis on data validation, ongoing performance monitoring, and documented improvements. Consistent financial reporting INREV, NCREIF, and MSCI reporting frameworks are global standards used by institutional investors for consistent reporting across real-estate funds and encourage cleaner financial data and unified methodologies. Better building operations Smart building operations platforms (Honeywell, Siemens, Johnson Controls) integrate energy, HVAC, safety, and maintenance data, supporting predictive maintenance and sustainability goals. Sustainability requirements Local Law 97 (New York City) requires large buildings to meet strict carbon caps, with penalties for non-compliance. This creates massive incentives for accurate energy data and continuous monitoring.
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Building Tokenization Report
The Architecture of a Tokenization-Ready Asset A tokenization-ready asset emerges only when these layers align. The physical property anchors the system, the financial instrument defines the claim, the digital data layer ensures the asset is intelligible to both humans and machines, and the blockchain layer provides trust and automation. When combined, they allow the asset to participate seamlessly in digital and onchain markets. Tokenization is the final expression of a well-structured asset.
Market & DeFi Integration
The environments where tokenized real estate can interact: exchanges, lending protocols, structured products, secondary markets, portfolio systems, and DeFi rails.
Blockchain / Smart Contract
Token standards, compliance rules, transfer restrictions, ownership logic, and automation frameworks that govern digital assets.
Digital Data Layer
The structured, machine-readable datasets that describe the asset: documents, BIM, inspections, provenance, version histories, operational logs, and lifecycle information.
Financial Instrument
The legal and financial wrapper around the property: ownership structure, capital stack, equity, debt, revenue streams, rights, and covenants.
Underlying Physical Asset
The building itself — its design, construction, systems, documentation, performance, and compliance footprint.
The preceding sections describe the conditions a real estate asset must meet before it can reliably participate in digital markets. Building is designed to operationalize these conditions in practice, turning fragmented documentation and legacy workflows into a structured, verifiable, finance-ready digital asset.
Building for Finance Readiness Real estate only becomes finance-ready when its documentation is complete, consistent, and verifiable. Building provides the structure required for this transformation by organizing source documents and creating a clear record of compliance and ownership. As information is validated and indexed, the asset becomes easier for lenders, auditors, and capital-markets participants to evaluate. What emerges is a cleaner, more transparent financial instrument surrounding a property with strong data for underwriting, accurate valuations, and eventual tokenization.
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Building Tokenization Report
Building for Operations and Performance A building’s operational performance depends on the continuity of its information. Building captures this continuity by linking construction records, maintenance logs, inspections, and performance updates into a single, evolving data model. This reduces uncertainty in day-to-day management, improves transparency in long-term planning, and strengthens the building’s sustainability profile.
With clearer histories and more reliable signals, operators can manage the property proactively rather than reactively. Over time, the building becomes easier to maintain, more resilient to failure, and better aligned with the expectations of tenants, regulators, and capital providers.
Building for Tokenization Tokenization really succeeds when the digital representation of an asset is accurate, current, and backed by verifiable data. Building prepares properties for this step by generating clean digital outputs that tokenization platforms can rely on: structured data with validated metadata and consistent inputs with clear links to underlying documentation. This foundation allows partners to issue tokens that reflect the true state of the asset and sustain trust over time, including in secondary markets and at institutional scale. Building does not replace tokenization platforms; it ensures that the assets entering those platforms are complete, compliant, and ready for on-chain integration.
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Building Tokenization Report
About Building, Inc Building, Inc is a data infrastructure company for real estate. The platform transforms fragmented property information into structured, verifiable, and finance-ready digital assets. By standardizing documents, validating metadata, and maintaining a continuous record of performance and compliance, Building enables developers, asset managers, lenders, and capital-markets participants to work from a shared, reliable foundation of truth. This reduces friction across the real estate lifecycle and prepares assets for advanced applications such as automated underwriting, digital reporting, and tokenization.
Building works across three core domains: finance readiness, where properties are organized into clear, consistent data packages; operations and performance, where ongoing updates create transparency and resilience; and tokenization readiness, where clean digital outputs support compliant, on-chain representations of real estate assets. Across each domain, the platform helps real estate meet the expectations of modern capital markets, regulatory environments, and digital ecosystems.
With a global perspective and a focus on practical implementation, Building aims to set a new standard for how real estate information is created, maintained, and activated—turning buildings into smarter, more transparent, and more connected components of the digital economy.
Building PropTech, Inc www.building.inc
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