After investing in the bustling Delhi/NCR real estate market, four friends—Mohit Gupta, Abhishek Madhukar, Puneet Gupta, and Aashish Raj—realised that their investments were yielding less than 2% during the pandemic, a far cry from the returns they had hoped for.
Restless, they started looking for a solution that would yield handsome returns. As the friends pondered their dilemma, an idea began to take shape. They thought, “What if we could invest in the lucrative holiday home market, enjoy the experiences these properties offered, and still secure attractive returns?” recalls Mohit Gupta, CEO, Equity Address.
This led them to start in 2021. A tech-driven fintech platform, Delhi-based Equity Address offers tokenised ownership and alternative approach to fractional ownership of high-end vacation homes. It also provides investors with handsome returns, including rent-free holidays and rental income.
“This concept allows a group of investors to co-own properties, reducing costs and opening up the market to a wider range of participants,” Gupta explains.
Fractional ownership of a home is 1-2% of the market, which will grow to 5% in the market. We want to democratise and disrupt this space, he adds.
As of now, the startup has a 32-member team specialising in technology, marketing, hospitality, real estate, sales, and finance.
Unlocking vacation home ownership
According to the founders, the startup has a unique approach to fractional property ownership, and offers true ownership, future gains, flexible scheduling for accommodation, and shared expenses.
Equity Address takes care of paperwork, asset valuation, clear title reports, and more, reducing the registration transaction time to around 90-120 days.
“We aim to make real estate investment a liquid-able asset accessible to more individuals, addressing the aforementioned challenges,” he adds.
The platform also ensures privacy for co-owners by providing a detailed dashboard for transaction management and updates, allowing them to connect, transact, and manage their portfolios securely.
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Equity Address Luxury Homes
” align=”center”> Equity Address Luxury Homes
The properties vary from 2 BHK apartments to 4 BHK private pool villas, with fractional ownership options starting from Rs 17 lakh. The average villa rental across India ranges from Rs 35K to Rs 50K per day.
Minimum share any investor can own is 10% or 1/10 of the whole asset, and there can be maximum of 10 investors per property.
As of now, Equity Address possesses approximately nine properties in Goa and has 20 investors.
Venya–the hospitality platform
In February 2022, Equity Address Pvt. Ltd, the parent company of Equity Address, launched The Venya, a platform that curates premium holiday properties such as luxury villas, boutique properties, and luxury apartments for short-term rentals of around 35 days.
“We aim to make vacation home ownership and luxury assets more accessible for people worldwide. Together, the Venya and Equity Address can create an end-to-end vertically integrated ecosystem that allows users to experience, rent, and own fractional interests in second homes,” Gupta says.
With over 500 listings, Venya provides homeowners with the opportunity to generate income through rentals while eliminating concerns about property management and guest services.
In addition to the financial benefits, Equity Address offers investors an exclusive private travel app, Venya-X, through which they can avail rent-free holidays for around 35 days per year.
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Equity Address Villa
” align=”center”> Equity Address Villa
The platform utilises AI and machine learning (ML) to help investors discover homes, estimate rentals, and predict investment hotspots. It also uses VR and IoT technologies to map homes, extend global reach, and simplify fractional buying and selling.
“These technologies will help users discover their dream homes, make rental estimations, and facilitate fractions selling and buying,” he adds.
According to Gupta, the startup has faced various challenges as land ownership rights vary across states, and the real estate market faces legal and regulatory challenges. “Also, the second home market is unorganised, with inconsistent rental and buying prices, and lack of awareness about fractional ownership benefits,” he adds.
Business model
Equity Address charges 5% platform fees from investors on the purchase of fractional ownership and 3% on resale after a lock-in period.
It also earns management revenue, which is 20% of the rental generation. The Venya operates on a revenue-sharing model with homeowners, and charges platform fees for exclusive listings, with a revenue share of 80% from owners and 20% from the platform. The exclusive listing is 75% owner and 25% leasing.
Equity Address, which was bootstrapped with an investment of $100K from the founders, has generated $200K in revenue so far, and plans to increase revenue ten-fold in the next year.
The startup competes with companies such as Alyf, Your’s, Hotel Yaari, Strata Prop, and HBITS, as well as indirect competitors like PACASO, MYNE, and VIVLA, and international competitors like GET STAKE, Landa, and FINTOR.
According to the team, what sets Equity Address apart from these companies is Venya’s rental forecast for a location, i.e., it forecasts or estimates rental rates based on analysis of data. The founders claim that Venya has been cash-positive since inception.
Plans ahead
According to Grand View Research, the global vacation rental market size was estimated to be $82.63 billion in 2022, and is expected to see a compound annual growth rate (CAGR) of 4.7% from 2023 to 2030.
The vacation and second home market in India, as per 360 Realtors’ research, reached $1.394 million in 2021, with a 23.63% CAGR.
Equity Address intends to acquire additional vacation homes, and plans to sell shares in 20 villas and 15 apartments worth Rs 120 crore in FY 23-24, with a target of attracting 200 retail investors.
The company is looking to secure $2.5 million in equity and $10 million in debt from various investors, including strategic investors, venture capitalists, private equity, family offices, and angel investors.
Furthermore, it is considering expansion within India, and is in the process of assessing locations such as Alibaug, Lonavala, and Goa.
Over the next two years, the company plans to expand in MENA, SEA, and Europe. It also plans to introduce a Luxury Residence Fund of Rs 500 crore in 2023-24, offering global co-ownership of luxury holiday homes and making it possible for Indian investors to invest in international properties.
The global residence fund will feature 20-24 luxury holiday homes across various countries, with an investment ticket size of Rs 1 million, offering investors across the world access the fund’s home portfolio.
Edited by Megha Reddy
