3i2ari.com is a real estate business that offers fractional property ownership to its clients. We specialize as well in overseas property acquisition. Our vision is to make real estate investment accessible to a larger number of people. The greatest barrier to entering the real estate market is capital. In simple terms, a lot of people do not have enough money to own real estate. To overcome this barrier, we provide our clients with the opportunity to own fractions of properties with family, friends, or some of our other clients.
Clients contact us via our website contact form and inform us about the capital they would like to invest and whether they want to own the property with family and/or friends, or whether they would like us to match them with potential co-owners. Once we have all the information necessary, we find our clients the perfect property that matches their capital and investment interests (i.e. residential, commercial etc.). And voila! Not only our clients can enter the real estate market with a small capital. But they can have fun investing in their favourite types of properties. Whether they would like to own a studio and lease it, have an Airbnb-friendly flat, or buy agricultural or farmlands, and plant some organic crops in it, they can do that too. Even more, we provide our clients with the opportunity for 3i2ari to manage their investment for a given fee. This means that we can manage their properties for them, such as leasing, rent collection and maintenance. We created a voting structure as well, which enables property co-owners to make any property related decision. In certain occasions for example, one co-owner would like to reside in the property for a given period of time. Or another co-owner has a great investment idea for the property. They can decide what to do what to do with their properties based on voting. This is paralleled by a legal document that each co-owner signs when purchasing their shares of the property, in which they agree on a voting structure being used for future property related decision making.
We found that for a large number of real estate enthusiasts, this type of ownership is much more interesting than buying shares on some real estate app. Buying shares on real estate apps is similar to investing in dividend stocks or in the foreign currency markets. It is a speculative type of investment which does not provide the investor with the opportunity to own a physical asset. Clients drawn to us are the type of investors who would prefer to have a physical asset at hand. Some have future plans to buy the asset for themselves from the co-owners, whilst others have investment ideas for their properties. For instance, a bunch of friends might be interested in owning a cottage at the beach. They would like to lease it on Airbnb for certain periods of the year and make monthly returns, whilst have fun and reside in it in other periods. They can do that with us, starting with a modest capital. Moreover, we found that the largest percentage of our overseas clients, would like to own a cottage in Lebanon. Their plan is to reside in it during their visit to Lebanon (mostly in the summer). And during their absence, they ask us to lease and manage the properties for them which generates monthly returns whilst they are overseas.
Another one of our services is overseas property acquisition. COVID-19 pandemic had its impact on the economy and consequently on the real estate markets worldwide. For instance, in Lebanon real estate prices dropped in certain areas by 300 %. A lot of international investors had their eyes on the Lebanese real estate market. They wanted to buy the dip but had no means of doing so. We solved that by providing them with the opportunity to complete the full property ownership legal process from overseas. In particular, Lebanese diaspora in the United States, Canada and Brazil constitute the majority of our overseas clients.
I am a researcher in aeronautics. I spent four years in the United Kingdom in which I completed a Master of Science and a Master of Research in aeronautical engineering at Imperial College London and in which I was employed as well to carry research on wing tip vortices. At the start of the COVID-19 pandemic I relocated to Lebanon, my home country, as the cases in the UK were rising at unexpected rates. During that period, I was working remotely with Imperial College London on a publication in the American Institute of Aeronautics and Astronautics, and I saw an opportunity in the real estate market. Back then, prices were dropping significantly whilst fiat currencies had a risky outlook and Lebanese banks had defaulted. So not only real estate prices majorly dropped which was a great opportunity to buy the dip, but risky bank outlook and poor credit ratings (Moody’s credit rating was a C and S&P was a D) provided people with a strong incentive to invest the money they had in their bank accounts.
The primary challenge that I faced was launching at a low cost. My business requires lawyers for property registration and for other legal aspects involved in fractional property ownership. I did not want to hire lawyers at the early stages to minimize the launching cost as much as possible. So, I called a law firm and offered them a case-by-case partnership. That means, for each property registration, contract, or any other legal document or job, they get paid a fixed amount of money. So, I would not be risking any capital. My lawyers get paid once clients decide to purchase a property. Even more, to save in rental costs, I had an appointment only policy. So, when clients go through our online process, and decide to purchase a property we gave them an appointment at our partner law firm and paid the law firm a fee for renting an office in their firm for a day. The second primary cost was hiring brokers. To shortcut that as well, I contacted brokers who were independently working (freelancers) and made them the following offer: you get to post your properties on my company’s website and for each sold property we would only charge you 0.5% commission, which would be the cost of maintaining our website and marketing the properties. So not only I did not have to pay brokers but added to my company’s 2.5% commission from our clients I had a 0.5% commission from brokers which adds a total of 3% commission per sold property. The last major cost was building the company’s website. I had a great experience in coding from my academic career in aeronautics. But not in building websites. My experience was in high performance computing which means the use of the so-called super computers to solve advanced computation problems. So, I took an online course on building websites on a specific platform and built the website myself. The overall cost to launch my business was surprisingly low. It was only approximately 50 USD which is the cost of purchasing the website domain name and hosting it.
I was lucky to launch my business at the correct time during which bank outlook was uncertain and real estate prices dropped significantly. That was such a great and rare opportunity for my business. Such a combination of poor credit rating and large drop in real estate prices in general happens rarely and is caused by large events, which in this case was the COVID-19 pandemic. Added to that, our innovation in fractional property ownership gave us access to a wider range of clients than conventional real estate firms. That opportunity is currently available in other countries, which gives us a great motivation to expand. We are communicating with experienced and interested individuals who would be good candidates for potential overseas partners. We are providing them with a website designed for real estate, and with access to our lawyers for free, whilst we share with them sales commission.
My advice for anyone starting a new business and particularly for those innovating in business, is not to focus so much on barriers. You must start from somewhere and figure things out during the process. Innovative businesses face a lot of unknowns since by definition, no one did the exact same business before. Therefore, there are not a lot of resources to learn from. This usually scares a lot of people from executing on their ideas. If you can find smart ways to minimize your expenses and launch your business idea within a reasonable budget, then just go for it. But at the same time be flexibility enough to modify and adapt your business model to what the market needs. I run two businesses whilst doing a PhD in Aeroacoustics at Canada’s top engineering university. Was I to overemphasize barriers I wouldn’t have started any of my businesses. My primary concern for example was time management. But I worked my way around it by building the right teams in each of my businesses, and everything worked out just fine.