FAQ

You have 100% control over the funds in your digital wallet. SmartCrowd is required to provide regular reports to the regulator on the client money account as well as conduct regular independent audits on the client’s money account. Think of your digital wallet like a separate bank account to keep your capital safe to invest on the SmartCrowd platform . You can add or withdraw your funds from your digital wallet at any time at no charge to you. 

Please note: standard bank charges may apply at withdrawal depending on your bank. These charges are independent of SmartCrowd.

SmartCrowd establishes an investment vehicle, called a Special Purpose Vehicle (SPV) for the purpose of purchasing the investment property.

Each property on SmartCrowd has its own corresponding SPV. And each SPV is broken into 1,000,000 shares. For ease of calculation, if a property is worth AED 1 million, each share in that property is worth AED 1. If an investor invests AED 500 – he/she owns 500 shares in that investment or 0.05% of the property. As per the Dubai Land Department’s requirement, this vehicle will be incorporated and registered in the DIFC (Dubai International Financial Centre).

The shares are always the property of the investors as they are the ultimate beneficial owners.

SmartCrowd does not own any shares. SmartCrowd facilitates the entire process to make this method of investing possible for you.

To learn more about how Investments are structured: Click Here

A Special Purpose Vehicle (SPV) is just a fancy way of saying “a separate new entity” – it’s no different than setting up a new business.

An SPV is created to isolate and securitize the said property in a separate company. The operations on the SPV are limited to the acquisition of the specific property to ring-fence the property and isolate the risk of the SmartCrowd platform and other properties. These SPV protect investors from SmartCrowd liabilities as well as protection from SmartCrowd’s bankruptcy. The SPV is registered with the DIFC and your ownership is recorded on the public register. The SPV is also registered with the Dubai Land department providing a legal trail of your ownership in the property via the SPV.

Currently, RERA (Real Estate Regulatory Agency) cannot accommodate more than five to ten people on a property’s title deed.

In order to accommodate multiple investors on a property title deed, SmartCrowd establishes one SPV for every investment property so that there isn’t a limit on the number of shareholders that can collectively invest in a property.

SmartCrowd will form an SPV for the purposes of holding your investment. You will hold Shares in the SPV. The SPV will be managed by Smart Crowd under the Administration Agreement. Pursuant to this agreement SmartCrowd and its Directors will sign any related documents for the SPV including but not limited to articles of association, relationship declaration, transfer of shares, ordinary shareholder resolution, divestment of investments, appointment of authorize signatory on your behalf. A Director will disclose to the other directors the nature and extent of any material interests in, any actual or proposed transaction and shall refrain from voting at a meeting of Directors on any resolution concerning a matter in which the Director has a direct or indirect interest.

As an investor, you do! The property is legally owned by the SPV and you as a partial investor have shares in the SPV in proportionate to your investment.

You are the ultimate owner and beneficiary of the property proportionate to your investment amount.

For example, if you invest AED 500 in a AED 1M property, you own 0.05% of that property via the SPV. The remaining 99.95% is held by other property investors like you! Collectively, you all earn dividends through the property. You will effectively own 0.05% of the issued shares of the SPV. The SPV will own 100% of the investment property.

Through this mechanism, not only can you invest in an affordable manner, but you can also reduce your risk because you can spread your capital across dozens of properties as opposed to one (i.e., as the adage goes: don’t put all your eggs in one basket!).

The SPV corresponding to the property investment.

Since it is not possible to list out dozens of names on a single title deed, the name issued on the title deed (ownership document) is that of the SPV corresponding to your property. Ultimately, you own direct shares in the SPV, which in turn is only responsible for holding the asset that is your investment property and paying out dividends to you. To see your name as a shareholder, simply go on to the DIFC public register and type the name of the SPV that corresponds to your property. Typically the name of the SPV starts with the initials “SC” followed by a hyphen and a number.

If the Total Funding Target is achieved and the Investment Round completes you will be sent a share certificate representing your Shares. If the Total Funding Target is not achieved within the relevant time period, all committed funds will be returned, without deduction of any fees or expenses to your SmartCrowd Account. You can then choose to use the returned funds towards another Property or withdraw the funds from your SmartCrowd Account entirely (the decision is yours!). Please note where you initiate a withdrawal of funds from your SmartCrowd Account via the Platform, we will return your funds to the bank account which you used to fund your SmartCrowd Account. Your SmartCrowd Account is a segregated account operated by Emirates NBD.

At this stage SmartCrowd does not allow for oversubscription. The shares in the investment are allocated on a first come first serve basis

 A Material Change means any change or new matter that may significantly affect the value of the Property, the ability to rent the Property, the return on the Property, or the value of the Investment. If a Material Change occurs during the commitment period, SmartCrowd will disclose prominently on its Platform details of the material change; notify committed investors of the material change, and require them to reconfirm their commitment within 5 business days; if re-confirmation is not provided within 5 business days, cancel the commitment. If a Material Change occurs after the commitment period, SmartCrowd will disclose such information along with details of the material change, any change in the rights of investors; and what steps, if any, SmartCrowd is proposing to take as a result of such material change.

In the unlikely event that SmartCrowd is unable to operate on a permanent basis, SmartCrowd will follow its Contingency Plan (CP). Where CP is initiated, all investors will be notified via email of the wind-down, provided with their current investment statement, and will be asked to use the platform to make a decision of whether to sell at current market levels or hold on to the property. If the outcome of a property’s shareholders is to majority hold the investment, the management of the property will be handed over to a predefined Property Asset Manager who will be responsible for administering the SPV, managing the facility manager, communicating with investors, and distributing dividend income. If, at the time that the CP is initiated, and the majority decision of investors is to liquidate the investment, Smart Crowd personnel will manage and oversee the sale of Property and the return of funds to investors proportionately less any costs associated. 

For a copy of SmartCrowd’s CP please write to [email protected]

SmartCrowd will charge a 4% transaction fee for arranging the investment at completion of the Property acquisition, such fee is to be calculated on the Total Funding Target. This fee will be split in two tranches. 1.5% will be billed at the time of the transaction and the remaining 2.5% will be billed at the time of the exit. The exit fee of 2.5% will be calculated on the greater of the Total Funding Target or the “Exit Value” (the value at which the Property is sold at the end of the Investment Term). 

There will be annual administrative fees of 0.50% of total cumulative investments. For example, if you have invested AED 10,000 in year 1 then at the end of the year you will be charged AED 50 (AED 10,000 * 0.50%If you then further invested AED 10,000 in Year 2 bringing your total investment with SmartCrowd to AED 20,00. At the end of Year 2, you will be charged AED 100 (AED 20,000 * 0.50%). If you exit any of your investments that will reduce your AUM which will result in lower annual administrative fees. Administrative fees will be debited from the investor’s wallet on December 31 every year and will be charged on a pro-rata basis. SmartCrowd will earn fees from Sellers for using the platform to sell properties ranging from 1-5%.

As a regulated entity, we are required to have a conflict of interest policy to identify, disclose, manage and mitigate any conflicts between us and our clients. We have put in place a Conflicts of Interest Policy which identifies those situations giving rise to actual or potential conflicts of interest and which provides details of how such conflicts are managed. Where the arrangements under our conflicts of Interest Policy are not sufficient to ensure, with reasonable confidence, that risks of damage to the interests of the client will be prevented, we will disclose sufficient details of the actual or potential conflict to you in order to enable you to take an informed decision as to whether to continue to deal with us notwithstanding the existence of such conflict.

Some Conflicts of Interest might arise from the following but are not limited to:

(1) SmartCrowd might use third parties such as brokers, affiliates, and distribution channels to market and promote the SmartCrowd platform for which SmartCrowd would pay commission or share revenue for onboarding investors.

(2) SmartCrowd in some cases will earn fees from Sellers including Developers/Brokers for using the platform to sell properties. This fee is usually a percentage of the property price.

(3) SmartCrowd will earn fees on the exit from the sale proceeds

(4) SmartCrowd might use service providers in which they have an economic interest or are part of the SmartCrowd group of companies.

SmartCrowd works with financial institutions, property brokers,  property insures and consult with independent consultants who provide their expertise. Alongside this, they use real-time market data provided by REIDIN, a reputable leader in real estate market data to ensure that our platform offers only quality properties that will provide healthy returns. Each property will also have an assigned facility manager. Each service providers evaluated on a periodic basis to ensure optimal service is being provided. SmartCrowd does not  receive any remuneration, fee, payment or commission from a real estate agent, property manager, valuer, custodian, or any other person providing a service related to the property. 

SmartCrowd works with financial institutions, property brokers,  property insures and consult with independent consultants who provide their expertise. Alongside this, they use real-time market data provided by REIDIN, a reputable leader in real estate market data to ensure that our platform offers only quality properties that will provide healthy returns. Each property will also have an assigned facility manager. Each service providers evaluated on a periodic basis to ensure optimal service is being provided. SmartCrowd does not  receive any remuneration, fee, payment or commission from a real estate agent, property manager, valuer, custodian, or any other person providing a service related to the property.