Wealth container platform Vauban is planning to bring its digital tool to the property sector before April next year.
The fintech start-up is aiming to provide real estate dealmakers and investors with the option of using its digitised and automated process for establishing and managing SPVs and funds for the acquisition of property in the UK.
Vauban’s service spans the initial structuring of the SPV or fund to transactional banking to accounting, to investors on-boarding, speeding up the process from an average of three months to around a week.
This allows dealmakers and fund managers to capitalise on more time-sensitive opportunities and focus on raising and making investments rather than admin, said Rémy Astie, Vauban co-founder and chief executive (pictured).
Tax residents of overseas countries will nearly always require an onshore UK vehicle in which to hold a purchased property and Vauban is in basic terms the “plumber” to enable these vehicles to be set up in a much faster way, Astie added.
“Real estate is one of the largest segments in alternative investments in Europe and the largest market for SPV and syndicate formations. It is a natural evolution for us,” Astie said.
“We believe we can help the property industry. Firstly, there are a lot of time sensitive opportunities in the real estate market that dealmakers currently miss out on because of the time and operations associated with setting up the structure and opening the bank account. Secondly, being a lower risk lower return type of asset class, the expense ratio matters a lot.”
Initially, Vauban is expecting to provide its service to small property syndicates of up to eight investors for a single property, but later to private property funds and other investors.
The firm already has one indirect real estate fund which lends money to property developers in the Nordics and also sees this as potentially being a growth area.
The push into the property sector was always part of the company’s business plan but has been spurred on following investment from proptech venture capital firm Pi Labs following the outbreak of Covid-19.
Pi Labs is “a fantastic investor for what we want to do,” because of its strong network in the sector, Astie said.
Currently, Vauban allows its users to launch hedge, private equity and venture capital funds to create SPVs and funds, and has around £200m worth of AUM.
Astie is forecasting that this will soar to circa £1bn, equating to around 200 vehicles by the second quarter of 2021 as the firm is appealing to larger and larger clients.
He declined to provide any growth targets for the real estate business, but admitted the property sector may be a little more conservative than venture capital in taking the risk of using tech platforms.
To send feedback, e-mail louise.dransfield@egi.co.uk or tweet @DransfieldL or @estatesgazette
