Once a property is 100% funded, SmartCrowd creates an SPV, Special Purpose Vehicle, to form a transparent ownership structure.
The SPV acts as a separate company for investors to become shareholders in it. Each property has it's own SPV, and each SPV is broken into 1,000,000 shares whereby SmartCrowd allocates your shares proportionate to your investment.
For ease of calculation, if a property is AED 1,000,000, each share of that property is AED 1. In other words, if an investor invests AED 500, then he/she owns 500 shares or 0.05% of the property.
As per the Dubai Land Department requirement, the SPV is incorporated and referenced in the public register of DIFC (Dubai International Financial Centre). It’s all regulated and more importantly, transparent!
SmartCrowd structures investments in this manner for two main reasons:
To hold several owners on the same title deed
To mitigate financial risk in case SmartCrowd ceases to exist