The Best Real Estate Assets in the Metaverse
Recent societal shifts have shown us how quickly things can change. Remote work, advancing e-commerce and consumer technology, and our transforming relationship with public life have made a huge impact on the way we live and conduct business. As a commercial real estate investor, it’s important to keep up on changing market sectors and to understand how best to navigate trends.
Your experience and success in the field give you the edge on optimizing your outcomes. Finding the right properties and helping your work thrive rely on being in the know and having your finger on the pulse. An uncharted world of real estate, however, may add another dimension to the traditional steps of acquiring property.
With the rise of popularity in cryptocurrency, there’s a new commercial real estate venture on the block that has been steadily gaining steam – owning property in the metaverse. You may have already started learning about virtual real estate, but if not, let this article officially put it on your radar.
So, what should you know about the metaverse? Right now, though the fate of the metaverse seems promising, no one knows exactly what the future will bring. Properties in the metaverse have been selling for millions, creating hype and excitement. Many questions remain — such as how this trend will unfold and whether it is just the next bubble. For those who enjoy early speculation and understand the potential risks (such as crypto-scammers and the success of your chosen metaverse), this new realm is well worth exploring.
If you’re ready to jump into the metaverse real estate market, you need to be ready. Here are some tips on how to navigate this new world and enter the space with informed intel.
What is virtual real estate?
To understand the world of virtual properties, you need to have a grasp on the concept of web3.
One of the goals of web3 is a virtual universe that allows you to be in control of your data. Instead of making profiles for each website, you create one profile, which you can use to freely access everything you want. You can choose who gets your data, and you may even get tokens for your participation/contributions.
Everything is stored in a decentralized blockchain – including your virtual wallet – which helps make transactions more secure. You can then use cryptocurrency to buy non-fungible tokens, or NFTs. NFTs are proof of ownership of one-of-a-kind items that you can buy in the metaverse, like art, collectibles, access to DAOs, or, you guessed it, real estate.
Why would you want virtual real estate?
Significant advances in artificial intelligence and virtual reality are happening every day – it’s rare for even the most technically-challenged individuals to not access the internet at least a couple of times a week. Most of us use it consistently, without as much as a thought, throughout the day.
“After work, you may log on to Zoom for a virtual happy hour, then hit other apps one more time before bed. “
The pandemic made the use of virtual platforms more mainstream. We had to come up with clever ways of working, visiting our loved ones, and entertaining ourselves during lockdown, which helped make virtual platforms more relevant than ever.
The influx of virtual platforms in our daily lives means many of us will likely be interacting in the metaverse as much as in the real world – when this will occur, however, is a mystery. Social media is a part of daily life. Watching YouTube or TikTok during breakfast, scrolling Instagram throughout the day, updating Twitter at lunch – it’s become more and more common to dwell in virtual spaces. After work, you may log on to Zoom for a virtual happy hour, then hit other apps one more time before bed.
In the metaverse, the theory is that you’ll be able to visit all these virtual worlds, but you won’t have to enter through social media platforms. Instead, you’ll be able to visit online venues, businesses, and houses that are owned by individuals. Its increasing popularity and variability are why major companies have jumped on the virtual real estate bandwagon and are snatching up real estate before it’s gone.
What type of virtual real estate should you buy?
Considering the metaverse consists of virtual worlds, the possibilities really are endless. Here are our top picks for the best real estate investments in the metaverse, ranked by potential ROI:
1. Virtual office spaces. Many businesses turned to the work from home model during lockdown. It has helped make commuting a thing of the past, and employees who are growing more and more comfortable interacting in virtual professional settings will likely never look back.
Savvy companies are realizing they can save a little money in the mix. Physical offices require heat, air conditioning, electricity, water, and cleaning crews. Virtual offices allow companies to keep the legitimacy of a central space while avoiding costly overhead.
Virtual-life example: To optimize employee experiences in virtual spaces, innovative startups like Virbela are creating metaverse offices and campuses that may define the future of work life.
2. NFT retail stores. Major companies are already jumping into virtual sales, and retail space has potential to be one of the most profitable forms of metaverse real estate.
Virtual-life example: Virtual products are more than a passing trend, and a full metaverse shopping experience will require virtual sales floors. Nike has already developed some cool metaverse sneakers, and the beauty product giant L’Oreal has been busy trademarking its place in the virtual world.
3. Ads and billboards. For those who are trying to build a business, advertising in the metaverse showcases their goods and/or services to a whole new type of consumer. Billboards are a prime spot to get the word out, and companies will be paying top dollar for great ad locations.
Virtual-life example: Celebrities like Paris Hilton are already delving into the new world of metaverse billboard sales.
3. Ads and billboards. For those who are trying to build a business, advertising in the metaverse showcases their goods and/or services to a whole new type of consumer. Billboards are a prime spot to get the word out, and companies will be paying top dollar for great ad locations.
Virtual-life example: Celebrities like Paris Hilton are already delving into the new world of metaverse billboard sales.
4. Houses and neighborhoods. Just as in the physical world, spaces in desirable neighborhoods are becoming fiercely competitive. Getting in at the right time on houses or complexes in up-and-coming metaverse areas is likely a lucrative bet.
Virtual-life example: Snoop Dog has acquired land from the popular platform Sandbox and is going to recreate his mansion and call it Snoopverse. Someone has already dropped some serious cash to be his virtual neighbor.
5. Concert and entertainment venues. Venues that can host functions of all forms have endless potential, as events like virtual live music, comedy, and theater hold increasing appeal. Investing in one of these has the potential to make you a lot of crypto.
Virtual-life example: The Sandbox already has one. Advancement in the use of holograms (remember the lifelike hologram of Tupac that was used for Coachella in 2012?) may result in some amazing metaverse concerts in the near future.
6. Arts and culture marketplaces. Digital artists are now able to sell original NFTs of their art, making the metaverse a very enticing place to begin displaying new work. This is a great move for artists who want to guard against their work being stolen on the internet. Venues that offer places to buy, sell, and just enjoy virtual art are sure to be sought-after properties.
Virtual-life example: KAZoART just opened its first NFT gallery in the CryptoVoxels marketplace, a space that allows artists to build their own art museums.
DECENTRALAND + THE SANDBOX + OPENSEA + SOMNIUM SPACE
DECENTRALAND + THE SANDBOX + OPENSEA + SOMNIUM SPACE
Where can I invest in virtual real estate?
The metaverse is growing rapidly each day. Right now, there are four major metaverse locations that are hot in the real estate world:
According to Yahoo, Decentraland had around 300,000 monthly active users and around 18,000 active daily users in January 2022. You can hang out in clubs, shop for NFTs, and even play games at casinos in this online world.
Cryptocurrency: SandD
Blockchain: Ethereum
The Sandbox allows you to both play and create games. As mentioned above, this is the platform that features Snoopverse. You can also visit museums and hangouts.
Opensea isn’t a digital world – instead, it’s an NFT marketplace that enables you to customize your online persona and find prime real estate.
Cryptocurrency: Cube
Blockchain: Ethereum
Somnium Space is a platform designed for those with VR goggle systems. You can use these devices to immerse yourself in the metaverse world.
So, what sort of metaverse real estate is good to invest in?
Ah, this is the burning question. Much like normal real estate, you have to buy where the people are. And, as each metaverse leans toward niche uses, you need to decide who you want to sell to and reach.
If you can snag prime real estate in a busy part of the city, you can build office spaces, apartments, or venues to rent out. The major platforms have a lot of promise in terms of entertainment, shopping, gaming, advertising, and other commercial endeavors, but it’s important to research how each metaverse fits your goals and aims.
While this world is still largely undeveloped and unregulated, metaverse investing is on the rise, and it could change the future of the entire industry. The flood of investors spending millions on plots signals optimism in the lasting potential of these spaces.
