- Grant Cardone has combined real estate investment with Bitcoin in a new multifamily housing fund.
- The latest fund includes a 366-unit property bought for approximately $235 million and $100 million in Bitcoin.
- The fund uses rental income to purchase more Bitcoin, blending stable income with digital asset exposure.
- This hybrid model aims to offer a publicly traded vehicle with tangible real estate backing.
- Real estate’s steady cash flow contrasts with Bitcoin’s volatility, addressing risks seen in crypto treasury companies without operating businesses.
Grant Cardone, a real estate investor, has expanded his multifamily housing fund strategy by integrating Bitcoin holdings. The latest investment includes a 366-unit multifamily property purchased for about $235 million, alongside an allocation of $100 million in Bitcoin (BTC), according to Cardone Capital as reported by Cointelegraph.
This approach combines the low volatility, tax advantages, and income generation from real estate with the high volatility and growth potential of Bitcoin. Rental income from the property, expected to generate around $10 million annually in net operating income, is intended to be reinvested into more Bitcoin purchases. Cardone described the goal as creating a publicly traded vehicle that functions like a digital asset treasury, but with real assets, tenants, and cash flow, stating: “The goal is to take that vehicle public and turn it into shares. We believe the real estate and the bitcoin combined as a stock, trading as a public company, is like digital asset treasuries. But we have a real product, a real asset, real income, real tenants, real customers. We have free cash flow.”
This hybrid model could influence future real estate investment trusts (REITs), which are portfolios of physical properties offering investors passive real estate exposure through stock exchanges. By combining Bitcoin with tangible real estate, the fund seeks to leverage the strengths of both asset types.
In contrast, many crypto treasury companies rely on issuing corporate debt and equity to acquire Bitcoin but lack operating businesses to generate cash flow. This absence poses risks, especially during market downturns, as noted by venture capital firm Breed. Cardone emphasized real estate’s role as a strong treasury asset due to its necessity, saying: “If the company’s just bitcoin, why am I investing in that company? Real estate is the best treasury company you can build because it’s not a product that is discretionary — you have to buy housing.”
The recent decline in the multiple on net asset value (mNAV) for treasury firms has restricted their financing capabilities. When the mNAV falls to or below one, these companies struggle to borrow and may be forced to sell assets or face bankruptcy, highlighting the advantages of a hybrid strategy incorporating real estate.
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