Cardone Capital, a real estate investment firm with over $5 billion in assets under management, launched the 10X Miami River Bitcoin Fund, a dual-asset fund consisting of a 346-unit multifamily commercial property located on the Miami River in Miami, Florida, and $15 million of Bitcoin (BTC).
In an interview with Cointelegraph, Cardone Capital founder and CEO Grant Cardone said the Miami River Bitcoin Fund, which is the firm’s fourth blended investment vehicle mixing BTC and commercial multifamily real estate, will convert a portion of its monthly cash flows to BTC.
Cardone told Cointelegraph the impetus to start the fund followed a suggestion from his brother. The CEO said:
“My brother said to me, you should look at if you would have converted all your cash flow from real estate to Bitcoin and what that would have done over the last 12 years. Well, it would have taken $160 million and turned it into around $3 billion.”
“So, when I saw that, I said I am going to create a fund where we buy real estate, add bitcoin, and then use the cash flow from the real estate purchase to buy more Bitcoin,” the CEO continued.
The CEO also told Cointelegraph that the long-term goal of Cardone Capital is to accumulate $1 billion of real estate and $200 million in BTC, which will be held as a treasury asset, across the hybrid funds.
The funds’ unique approach of blending income-producing hard assets and Bitcoin as a store of value could disrupt the market for real estate investment trusts (REITs), market-traded funds giving investors access to baskets of income-producing properties, and other traditional commercial real estate investment vehicles.
Related: US real estate asset manager launches $100M tokenized fund with institutional backing
Onboarding users to Bitcoin by abstracting away the technical barrier to entry
The CEO added that he wants to onboard investors and tenants alike to Bitcoin and expose them to the digital asset, without them necessarily having to acquire the technical knowledge to understand how Bitcoin works.
A rewards program, paid in Satoshis, to long-term tenants, who pay on time and exhibit good renter behavior, is one idea the real estate investment firm is mulling, Cardone told Cointelegraph.
One of the goals of the hybrid real estate BTC funds is to drive the adoption of Bitcoin and provide investors, who would otherwise avoid Bitcoin due to having to overcome the technical barrier to entry, with exposure to the digital asset, the CEO said.
“We are onboarding people into a real estate vehicle that they understand and buying Bitcoin for them,” the CEO added.
Cardone also told Cointelegraph that he is working with other financial firms to create a hybrid Bitcoin mortgage product giving clients the ability to borrow against their combined Bitcoin holdings and equity held in a real estate investment.
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