Tokenization of real estate refers to the process of digitally representing ownership of physical property through blockchain-based tokens. In Turkey, where foreign investors increasingly acquire real estate, tokenization introduces a new model for fractional ownership, global accessibility, and liquidity. However, the process must comply with Turkish property law, securities regulation, and crypto asset guidelines. A qualified Turkish Law Firm plays a critical role in bridging legal infrastructure with emerging technologies.
At ER&GUN&ER Law Firm, our English Speaking Turkish Lawyers advise property developers, foreign investors, and Web3 platforms on how to structure tokenized property offerings legally in Türkiye. We draft legal frameworks, perform title deed due diligence, and ensure your token model aligns with applicable legislation.
What Is Real Estate Tokenization?
Real estate tokenization involves dividing ownership of a property into digital units (tokens) that are issued and traded on a blockchain. Each token represents a portion of the asset and may carry voting, revenue-sharing, or resale rights. In most cases, tokenization is used to:
- Offer fractional ownership of high-value assets
- Enable international participation in Turkish property markets
- Facilitate liquidity for traditionally illiquid assets
- Create blockchain-based investment vehicles for real estate
However, tokenizing property in Turkey involves navigating land registry law, banking regulation, capital markets licensing, and crypto compliance rules.
Legal Challenges in Tokenizing Turkish Real Estate
Turkish real estate law requires all ownership transfers to be recorded at the General Directorate of Land Registry and Cadastre (Tapu ve Kadastro Genel Müdürlüğü). This poses limitations to direct blockchain-based ownership recognition. Key legal challenges include:
- Tokens cannot substitute official TAPU registration
- Only physical persons or legal entities can be title holders
- Foreign ownership limitations under Military Zone laws still apply
- Fractional ownership must comply with condominium, trust, or partnership structures
Our firm creates hybrid models where tokenized interests are legally backed by shareholding in a company that owns the property (SPV-based model).
SPV and Corporate Structuring for Tokenization
The most common legal method to tokenize property in Turkey involves creating a Special Purpose Vehicle (SPV)—a company that holds the real estate title. Tokens are then issued to represent shares or income rights in that SPV. Advantages include:
- Legal recognition of SPV ownership under Turkish law
- Ability to define profit-sharing and exit clauses
- Faster regulatory compliance compared to direct land tokenization
- Clear asset segregation and liability limitation
Our Turkish Law Firm registers the company, drafts Articles of Association compatible with token distribution, and performs title transfer under secure conditions.
Securities Regulation and Capital Markets Authority (SPK)
If the issued tokens are deemed investment instruments, they may fall under the jurisdiction of the Turkish Capital Markets Board (SPK). Key compliance factors include:
- Whether tokens represent revenue, resale value, or voting rights
- Whether public offering rules apply
- Whether token issuance involves marketing to non-accredited investors
We analyze token models to determine whether an SPK license is required and draft disclaimers, offering documents, and whitelist agreements accordingly.
Real-World Use Cases in Turkey
Tokenization is already being explored in several Turkish sectors where property-based financing or investment is common. Notable areas include:
- Residential Real Estate Funds: Tokenizing rental income from long-term apartments in Istanbul and Antalya
- Tourism Properties: Fractional ownership of boutique hotels and villas in Bodrum, Fethiye, and Alacati
- Development Projects: Token issuance tied to revenue share from future sales
- Real Estate Investment Clubs: Cross-border syndicates investing in Turkish properties through a tokenized platform
- Startup Real Estate Platforms: Tech companies offering global user interfaces to access Turkish property tokens
We assist in structuring each transaction with robust legal documentation to withstand regulatory review and investor scrutiny.
Tax and Compliance Considerations
Tokenization introduces new tax liabilities that must be carefully managed. Our Turkish Law Firm provides end-to-end tax guidance including:
- Income tax on rental or resale proceeds for token holders
- Corporate tax obligations for SPVs
- VAT applicability on service fees or token transfers
- International tax treaties to prevent double taxation
- Crypto transaction declarations for Turkish residents
We coordinate with certified public accountants and tax counsel to ensure your token model is tax-optimized and fully reported.
Internal Legal Resources for Token Projects
- Real Estate Due Diligence in Turkey
- Legal Entities Owning Real Estate
- KVKK and Data Protection for Token Users
- Foreign Currency and Asset Reporting
- SPV Company Setup in Turkey
Frequently Asked Questions (FAQs)
- Is tokenized property ownership legal in Turkey? Not directly. Blockchain tokens are not recognized in the land registry, but indirect models using company shares or contracts are enforceable.
- Can foreigners buy tokenized Turkish real estate? Yes, through SPVs or legal structures that comply with foreign ownership rules.
- Do I need a license to offer property tokens? Possibly. If tokens are marketed as investment instruments, an SPK review may apply.
- What are the tax obligations? Token income is subject to Turkish tax law. We provide tax structuring and declaration support.
- Can tokenized assets be sold on global platforms? Yes, if compliant with both Turkish and foreign securities regulations.
- Can I register tokens at the land registry? No. TAPU records are not linked to blockchain. Legal enforceability is built through corporate and contractual layers.
- Is this model compatible with Turkish citizenship investment? Only if a single buyer is shown on the TAPU. Token models typically don't qualify unless structured accordingly.
- How can a Turkish Law Firm help? We create full token legal frameworks, SPV setup, title verification, tax compliance, and investor protection documents.
Work with a Turkish Law Firm for Real Estate Tokenization
Tokenizing real estate assets in Turkey is a transformative approach to property investment, but only when backed by a solid legal foundation. From SPV setup to escrow, tax structuring to investor protection—each step must comply with Turkish law and align with international best practices.
At ER&GUN&ER Law Firm, our English Speaking Turkish Lawyers offer end-to-end legal services for real estate tokenization. As a proven Turkish Law Firm in the property, blockchain, and investment sectors, we build secure, enforceable, and scalable legal frameworks for Web3 real estate ventures.