Lawsuit Filed Against RealToken Over Alleged Neglect in Property Management

Investigation Sparks Legal Action

A recent lawsuit has emerged following an investigation by Outlier Media that scrutinized the operational practices of RealToken, a company involved in the fractional ownership of rental properties.

How RealToken Operates

RealToken facilitates investment in rental properties by offering shares through digital tokens. Primarily focused on properties in Detroit, these assets are managed by various limited liability companies associated with RealToken. Investors can buy tokens that signify their stake in the property, allowing them to earn rental income and participate in decision-making processes related to the property. Each property is overseen by a management firm tasked with handling daily operations and tenant relations.

Claims of Global Accessibility

On its official website, RealToken promotes its platform as a means for international investors to tap into the U.S. housing market through compliant and fractional ownership via tokenization. Since its inception in 2019, the company claims to have attracted over 65,000 investors.

Allegations of Mismanagement

However, city officials in Detroit have raised concerns that the innovative approach has led to significant issues, including property neglect, unpaid taxes, and a lack of communication from the company.

City Officials’ Response

James Tate, the president of the Detroit City Council, expressed frustration over RealToken’s failure to fulfill its commitments. “The company made numerous promises during a Zoom meeting and in follow-up calls, yet none have been honored. They are unresponsive, and their property tax obligations remain unpaid. This situation feels personal,” Tate stated.

Conclusion

As the lawsuit unfolds, it highlights the challenges and responsibilities associated with innovative property investment models, raising questions about accountability and management in the real estate sector.

Disclaimer: This article is provided for informational purposes only and does not constitute financial advice. Readers are encouraged to conduct their own research before making any investment decisions.