SINGAPORE (May 5): In a bid to update its operations for an era of technological disruption, ARA Asset Management Limited and its group CEO, John Lim, have jointly acquired a majority stake in Minterest, a Singapore-based online crowdfunding platform.
“As a progressive real assets fund manager, ARA sees vast potential in the use of technology in real estate. By combining the Group’s strong track record and experience in underwriting real estate deals with Minterest’s robust crowdfunding platform, we are able to bring quality institutional-grade real estate investment opportunities to everyone,” said Lim.
“Investors can rest assured that the deals presented to them are endorsed by a reputable fund manager. We looked at a wide range of different potential partners and chose Minterest because they are the best,” he added.
Established in 2016, Minterest is an award-winning non-bank fintech group with dual licenses in Singapore. It was named as one of Asia Pacific’s top 25 fintech companies by CIO outlook in 2017 and 2018 as well as one of the 30 best small companies to watch in 2018 in the Silicon Review. Using psychometrics to assess an investor’s risk profile and blockchain technology to secure transactions, it claims to provide loan approvals within 48 hours, with 87% of transactions closed within a single day.
ARA Group will jointly acquire a 52.08% stake in the three-year old fintech firm with JL Family Office, a holding company for firms founded by Lim. ARA Group’s shares will be held by its property management arm APM Property Management Pte Ltd. Lim will serve as Chairman of Minterest’s Board of Directors while ARA Group’s Assistant Group CEO cum COO Ng Beng Tiong and JL Family Office CEO Andy Lim, son of John, have been appointed non-executive directors.
“The investment from ARA and Mr John Lim is a great boost to Minterest. With ARA’s strong backing, we will be able to enlarge our user base, develop more products to provide alternative investment options to retail investors, especially at a time where interest rates are expected to stay lower-for-longer,” said Minterest CEO Charis Lau, who has nearly two decades of financial experience in Asia with an international bank.
According to Lim, the acquisition of Minterest will allow the established real estate investment firm to adapt to demand from a more tech-savvy retail customer base for more convenient and secure avenues to invest in real estate. Besides providing easier access to crowdfunding and predictive analytics, ARA also hopes to use Minterest’s experience with “tokenisation” to develop secure digital assets on blockchain systems that can be sold to investors in the form of distributed shares, providing what he calls “another playground for retail investor”.
“Traditionally, investors who want to own real estate would have to acquire the physical property or invest in REITs. Today, technology has opened the doors to real estate investment in exciting new ways. Crowdfunding is an increasingly popular way for developers to access the working capital required for development projects and for investors to achieve attractive risk-adjusted returns without the need to come up with a large amount of capital,” said Minterest Chief Commercial Officer and APM Director of Fintech Janice Koh, who says that the new products will provide a more diversified asset base than traditional REITS.
ARA and Minterest also announced that they would be launching their first real estate secured mezzanine debt financing product on 15 May by way of co-investment with Straits Real Estate (SRE), which is co-owned by Straits and John Lim. With investors having the opportunity to participate in the secured mezzanine debt financing of a 64-level high rise residential development project in Melbourne’s Central Business District, minimum investment amounts will start at $5000 and made available for short tenure.
Lim hopes that ARA’s foray into fintech would lead to the opening of new global real estate markets for the firm. He also hopes to eventually expand these offerings to ultra-high net worth individuals who may wish for a quicker and easier way to conduct real estate investments.
“The launch of Minterest’s inaugural real estate product will present retail investors with a unique opportunity to invest alongside SRE and myself. The robust credit scoring process and system that Minterest has in place enables us to reach out to investors directly and efficiently, aided by technology. With the successful launch of the first real estate product on the Minterest platform, in partnership with SRE, ARA will leverage the platform to offer more real estate products in the near future,” Lim concluded.
