Bulkestate is a real estate crowdfunding platform that also facilitates residential real estate group-buying deals. The platform offers fractional investments in debt secured by Latvian real estate. In this interview, you will learn from the CEO & Co-founder Igors Puntuss what it means to invest with Bulkestate.
This is a written interview with Bulkestate. P2PMarketData does not receive statistics data to perform in-depth checks of the information and numbers presented by Igors.
To learn more, get a quick overview of Bulkestate.
First, could you tell the readers a bit about your own background? How did you become interested in working with finance?
The idea of Bulkestate was created because I, myself, have been close to the real estate industry in my professional career as well as my partner and co-founder of the company. We wanted to fulfill our goal of creating a fintech platform that brings together investors who are interested in passive income and real estate developers who need financing for their projects. Plus, we had this idea of a completely new approach to property sales in the form of group buying which has proven to be a success. We were actively working on real estate development projects and brokering real estate deals and noted that many attractive properties did not sell due to low liquidity for large ticket sales as many owners of residential buildings were willing to sell the building in a single transaction to avoid the hassle of separate apartments.
Along with our team, who all are close to the industry and have a diverse multi-year experience in real estate, we knew that the platform will deliver the results we hoped for upon its creation.
How do you find and assess the investments Bulkestate makes available to retail investors?
We carry out quite a layered due diligence process to make sure that both the borrower and the property are fitting to our set of guidelines for secure and profitable investment objects. While the borrower company is examined by our legal team, we also have the capacity to assess the property that is offered as collateral and its overall worth and attractiveness in the market as one of our team members has over 10-year professional valuator experience in the largest real estate agency operating across the Baltic region.
The investment properties are selected very carefully, taking into account current market conditions, global and local trends as well as the condition of the property, even if its value surpasses the necessary amount for the loan. During the years of operation, our team has developed a successful system of investment object assessment and we are very satisfied with the results as our objects carry very profitable annual interest rates which is possible because of this careful selection. It also explains why we have comparatively fewer investment objects on the platform compared to others.
Why should the readers choose to invest at Bulkestate?
One of our core principles since the very beginning of our company is to never impose or enforce anyone to invest in our objects by some loud slogans or comparisons to others. Our platform is for experienced investors who already know how investing works, and the probable risks it carries along, regardless of any aspects. Besides, Bulkestate has always been clear about bringing more quality than quantity to our investment objects.
While we surely are eager to expand and develop as a team and the company, we like to think that our investors grow with us. A large part of our active investors have been with us since year one and they surely appreciate the profit they receive. We measure our success in our investor loyalty, which is most challenged in difficult times, especially in the recent two years when the economic situation was massively affected by global events and we are still dealing with our share of that effect today.
Nevertheless, our deals are secure and the inviolability of the funds of our investors always remains the top priority for our team when dealing with any challenges. We have proven it through numerous cases when seemingly unsolvable situations have been resolved thanks to the persistence of our management and legal team.
What sets Bulkestate apart from other real estate investment platforms?
One of our unique elements is the group-buying deal approach, that we have pursued along with the investment objects. This year our team focused on developing more in this direction, which has resulted in a completed 6th group-buying deal on the platform. At the very moment, we are working on two upcoming group-buying deals which should be published on the platform any day now. Furthermore, we are looking forward to bringing more of these deals in 2023 and possibly also outside the Baltics.
We are also developing real estate properties ourselves, which allows us to provide more attractive financial conditions for the investors as well as the transparency of the deals.
I would also like to emphasize once more our team, which, being rather small, has brought together a set of experts that allows us to operate more efficiently and thanks to the smaller size - probably be more flexible as well.
How do you decide when a loan is defaulted or with minimal chance of recovery?
The most important indicator is communication with the borrower. We are always looking for all possible options to resolve a delay or struggles with repayments before announcing a default on the loan and, in most cases, it has proven the best way how to settle the situation. We are firstly looking at the scenarios which would minimize the burden for investors and their funds and, honestly, in a standard case do not look at the default as an option at all as mostly that means that there might be partial loss of funds for investors. Although we are aware that any changes in the repayment schedule are unpleasant and frustrating for investors, still it is better to adjust some dates than lose any of the invested funds.
If the borrower rejects any communication or is not willing to find a solution for a problem situation, then, of course, we initiate the legal procedure that is required to recover the debt to our investors.
How is Bulkestate regulated?
Bulkestate is an Estonian company and the company operations are regulated by the country’s general commercial legislation. To operate as a financial institution, Bulkestate has received a financial institution license that is issued by Estonian Police and Border Guard Board allowing providing financial services.
At the moment, Bulkestate is working towards fulfilling all requirements to complete the licensing process that is implemented in the European Union. The process of crowdfunding regulations is underway to control and monitor the security and transparency of the deals.
What do you think the future of real estate crowdfunding looks like? Which challenges do you see for the industry in the coming years?
The current economic situation also indicates the nearest future of the industry. While the recent months have seen fewer investment objects than usual, our team is still hunting down profitable investment opportunities to offer for our online platform users, yet we are much more careful in monitoring the real estate market situation to make the best possible decisions that would be also profitable in future. The real estate market this year is affected by the global energy market and that is no secret that the future holds some inevitable changes too. Our team along with the whole world is looking forward to the global environment to stabilize and return to more frequent project flow on the platform.
What’s next for Bulkestate? Where do you see your platform in five years?
Bulkestate has successfully tested its platform in Latvia and is now looking for expansion in other Baltic and EU countries, aiming for Germany and Spain in particular. We believe that the market environment in these countries is favorable to continue to pursue our model of the relationship between the sellers, buyers, and real estate agents we have achieved in Latvia.
The group-buying deals will be pushed more on the platform to offer more profitable properties for sales, and we are looking forward to the first sales deals outside Latvia. We will continue to grow as a team and increase the quality of our services. We aim to deliver the results our investors expect us to and continue to provide the best deals.