A token described as "a share in a Dubai apartment" or "a piece of a Detroit rental house" does not, by itself, say what happens if the manager stops paying, a city sues the landlord, or the issuing platform closes. Real estate tokenisation is not one instrument. It is at least four different legal claims wearing the same word, and the difference between them decides what a holder owns when things go wrong, not only when they go right.
Four things a "real estate token" can be
A token sold as real estate exposure is usually one of the following: a share or membership interest in a company that holds one property; an interest in a vehicle that holds loans secured against property; a unit in a fund, or a feeder into a fund, that holds several properties; or, in the smallest and newest category, a token a land registry itself issues or recognises. Each carries different income rights, governance, transfer restrictions and, most consequentially, a different place in the queue if the manager or platform fails.
A share in the company that owns the building
The most common structure puts one property into its own company and sells tokenised interests in it. RealT, whose SEC filings give a Boca Raton, Florida address, ran this model at scale, concentrated in Detroit rentals. Each house sat in its own entity: Form D filings from 2022 show per-property Delaware corporations such as RealToken 11310 Abington Ave., Inc., each sold under the Rule 506(c) exemption, while the city of Detroit's later lawsuit named affiliated LLCs. Rent was paid out to token holders. What a holder owns is whatever the entity's documents give a shareholder or member: an economic claim on distributions and any votes those documents grant, not title to the house and not control over who manages it. Secondary liquidity, where it exists, depends on whatever venue the issuer supports, not on a public exchange.
This model's weakness was shown by a live case rather than a risk factor. On 2 July 2025 the City of Detroit sued RealT and 165 affiliated LLCs over more than 400 homes with roughly $500,000 in accumulated violations, in what city officials called its largest-ever nuisance abatement lawsuit. On 23 July 2025 a Wayne County Circuit Court judge issued a temporary restraining order barring rent collection on non-compliant properties until they received certificates of compliance, and requiring tenants' rent to be paid into escrow accounts that could be used only for repairs. On 22 April 2026 the court approved a settlement placing a special fiduciary in control of roughly 700 Detroit properties; the escrow then held just under $640,000. On 2 July 2026 RealT announced the voluntary liquidation of its US structures, meaning the progressive sale of the portfolio, and weekly distributions to token holders were suspended. The platform is reported to have raised roughly $140 million through token sales. As equity in the property companies, token holders stand behind those companies' obligations, and a competing platform reports that RealT has said sale proceeds will go first to stabilisation and obligations rather than directly to holders. A share in the company that owns the building is a claim on what is left in that company, not on the building.
A claim on a debt, not the building
A second structure tokenises the loan rather than the equity. On 30 September 2024 Kin Capital announced a $100 million tokenised real estate debt fund on the Chintai network, starting with a $5 million tranche, open to accredited investors with a $50,000 minimum. The fund holds performing real estate trust deeds, under which a property is held by a neutral third-party trustee until the loan is repaid. The token holder owns an interest in the fund, and the fund holds the lender's position. A secured lender ranks ahead of the property's owner and its equity investors, so on a borrower default the fund's route is recovery through the security rather than a wait for residual value. Governance runs to the loan terms and the fund documents, not the building, and the announcement described no secondary market. The case for the structure is the seniority of the claim, not ease of exit.
A unit in a fund that holds many buildings
A third route tokenises access to a fund with a diversified portfolio. In April 2021 the Singapore platform iSTOX, regulated by the Monetary Authority of Singapore as a digital securities platform and since renamed ADDX, offered individual accredited investors tokenised exposure to the Mapletree Europe Income Trust, which holds Grade A office properties in Europe. The token was not a unit in the trust. The platform's own offering page says that "any investment will be made with Prometheus-2 Pte. Ltd. and your return will differ from a direct investment in Mapletree Europe Income Trust"; the minimum was EUR 20,000 and the offering has closed. In substance this is the company model again, one layer further from the property: the "fund unit" label describes what the feeder invests in, not what the token holder legally holds. Distributions pass from the trust to the feeder to token holders, with an extra layer of fees; decisions about the properties sit with the trust's manager; and if the feeder fails, holders are investors in a Singapore company, not in the trust.
A registry entry: Dubai's pilot
The most legally ambitious model brings the land registry itself into the structure. Dubai Land Department (DLD) announced the pilot phase of a real estate tokenisation project on 25 May 2025, run through the Prypco Mint platform with the Virtual Assets Regulatory Authority (VARA), the Central Bank of the UAE and the Dubai Future Foundation, and with Zand Digital Bank as banking partner. At launch it was open only to UAE ID holders, the minimum investment was AED 2,000, and all transactions were in dirhams, with no cryptocurrency. On 29 May 2025 DLD announced what it called a Property Token Ownership Certificate, following the first tokenised sale. On 9 February 2026 it launched Phase II, still described as "a controlled pilot framework", enabling about 7.8 million previously issued tokens to be resold on a secondary market from 20 February 2026.
What the token is in law is the question the announcements leave open. DLD describes tokenisation "on title deeds", and Gulf News describes each token as a proportional economic interest linked to the underlying title deed, but none of the three DLD announcements we read says whether a holder owns a registered share of the property or an interest through an intermediate vehicle, or which record would prevail if the token and the land register disagreed. Until published rules or a dispute settle it, that is the question to put to any platform in the scheme.
Earlier government projects put registry records on a blockchain without making a token the title. Sweden's land registry authority, Lantmäteriet, tested property transactions on a private blockchain with ChromaWay, Telia, Kairos Future and two banks, and by May 2017 the partners were planning a further implementation test that included a framework for governance. HM Land Registry's Digital Street research project, announced in April 2019, re-ran a completed sale of a house in Gillingham, Kent, which had taken 22 weeks, through a blockchain prototype; the demonstration ran end to end in less than 10 minutes, and HM Land Registry said it wanted to explore other models and providers. Georgia's National Agency of Public Registry, first in 2016, added a timestamping service that publishes hashes of property certificates to the Bitcoin blockchain, while keeping its digital registration process intact. In each case the conventional register remained the legal record. Our reporting on that history, and on public-sector deployments that did scale, is at Blockchain in government: what has shipped.
What securities and property law say
Status matters more than mechanism here, because the same phrase about "regulatory clarity" can describe a rule in force, one adopted but not yet applying, a draft or a speech. In the United States, the 2018 St. Regis Aspen offering shows the securities-law route. Its Form D, filed in October 2018 under the Rule 506(c) exemption for accredited investors, reported $18 million sold. Each token represented, under a deposit agreement, an indirect interest in one share of common stock of Aspen Digital, Inc., a Maryland corporation formed to own the resort, and the tokens sold amounted to 18.9% of the hotel. The holder owned an interest in a share of a company, not in the resort's real property.
In the European Union, the Markets in Crypto-Assets Regulation (MiCA), which entered into force in June 2023 and has applied in full since December 2024, excludes crypto-assets that qualify as financial instruments. A tokenised share in a property company, or a fund unit, that qualifies is governed by existing securities law, such as MiFID II and the Prospectus Regulation, not by MiCA. The European Securities and Markets Authority's guidelines on when a crypto-asset qualifies, dated 19 March 2025, apply 60 days after their publication in all EU languages; they are guidelines that supervisors must make every effort to comply with, not new legislation.
Switzerland's DLT Act brought ledger-based securities into law from 1 February 2021, with the rest of the Act in force from 1 August 2021. It does not reach the land register. Under the Swiss Civil Code, registration in the land register is necessary to acquire land ownership (Article 656), and a contract to transfer it must be executed as a public deed to be binding (Article 657). A Swiss token can represent shares in a company that owns property; it does not itself transfer the land.
The questions that decide what a holder owns
Across all four structures the questions are the same: which entity, not which token, holds legal title; what the holder is owed and in what order relative to lenders, tax authorities and a manager's own creditors; whether transfer restrictions and eligibility checks are enforced on-chain or only in an offering document; and what a secondary market, if one exists, actually trades. A token can automate distribution and settlement without automating away the property, corporate or trust law underneath it. RealT shows the company wrapper under stress; Dubai shows a registry building the token into its own records before the courts have said what it is. This is not tax, legal or investment advice. For the same question asked of equities, see tokenised stocks: what the holder owns; for the operational plumbing a production-grade tokenised asset needs, see institutional RWA tokenisation from pilot to production.