If you talk to people working in the Metaverse, they will continue to explain, “It’s like the Old West.” Make it what you want. Will it be a new frontier for wealth seekers? Lawless area? Characterized by an unknown location, cut off from the rest of society? Probably all of the above. But one thing is certain: the Old West people were not declining. $650,000 Cryptocurrency on Digital Yacht.
The Metaverse, an immersive virtual online world where users live and play, has become a hotbed of real estate speculation. Investors are betting that this is an integral part of a potential paradigm shift in how we use the Internet. called the decentralized version. web 3Proponents say it will wrest control of the web from big tech companies and distribute power, privacy and security to users.
According to consulting firm McKinseycorporations, venture capitalists and private equity invested $120 billion in the Metaverse between January and May 2022, more than double the $57 billion in 2021.
But real estate values were volatile. According to Winston Robson, CEO and co-founder of metaverse analytics firm WeMeta, land prices across four major metaverse platforms, Sandbox, Decentraland, Cryptovoxels and Somniumspace, have fallen by 50-80% this year. He pointed to problems in the real world economy and the cryptocurrency market as part of the reason for the decline.
But look beyond the numbers and you’ll find entire professions are being shaken, from architects and designers to developers and real estate agents. And their adventures in the Metaverse are already impacting the real world, far from being isolated in the Metaverse.
Voxel Architects CEO George Bileca was working toward a career in automotive design when he was given land to study architecture and design and play with Cryptovoxels. At the beginning of the pandemic, he used it to build dealers selling NFTs (non-fungible tokens). digital car Designed by his friend. Two years later, Bileca has his team of 25 working full time in the Metaverse.
Headquartered in Portugal, Voxel Architects has designed and built more than 100 Metaverse projects, including auction house Sotheby’s galleries, fashion week venues and NFT manufacturing plants for American artists, said the CEO. tom sachs.next official Elvis Presley experience In Sandbox and Decentraland.
According to Bileca, the process of designing buildings in the Metaverse is initially very similar to the real world. Architects and designers consult with clients and sketch ideas on paper or on a computer. Once a design is agreed upon, it is 3D modeled using traditional design software, but adheres to the design specifications of the metaverse being implemented (different metaverses use different building blocks, textures and colors). different ranges).
After that, the coding begins. “This structure is just an empty corpse,” Bileka explained. “On top of that shell, we’ll add the ability to open doors, interact with artwork, and create custom (user interface), gameplay quests, and many other interactive elements.” Deployed to the metaverse.
The studio charges an hourly rate for work, with some projects running into the hundreds of thousands of dollars. The most expensive is that it costs him nearly $500,000 to design, build and deploy development in a sandbox, Bileka said (the client didn’t disclose).
Some people buy real estate for entertainment purposes. Some are trying to make an income from the land. Some are building retail spaces and ticketed experiences. Some companies rent out land to brands looking to reach consumers in the metaverse.According to McKinsey, up to $2.6 trillion Market impact to 2030.
LandVault claims to be the largest land developer in the Metaverse, renting out its land to brands and running campaigns for brands. Just don’t call it advertising, insists CEO Sam Hoover. “On Web3…the word really has no place,” he said. “What we’re building isn’t advertising. It’s a brand experience, and it’s going to be very different.”
He gave the example of playing a game in the Metaverse inside an arena with a Mastercard logo. “You can still play the game. It’s not advertising. It’s not annoying. It’s like real life,” he claimed.
“[Online]advertising, as we know it, is intrusive, compromises user data, etc., and Web3 has no room for that.”
As in the real world, location has a big impact on rental prices. Being in a high traffic area, near a popular game, or near valuable property (such as a celebrity’s home) can be important. But some argue that good design is also valuable.
One of the proponents is Janine Yorio, CEO of Everyrealm. Formerly known as Republic Realm, the Metaverse developer has so far received $66 million in funding and backed by celebrities such as The Weeknd, Will Smith and Paris Hilton. That gorgeous project generated headlines. In November 2021, Everyrealm purchased 792 lots (equivalent to about 3 square miles) of The Sandbox for $4.3 million, still a record purchase price. Around the same time, he sold a $650,000 superyacht. meta flowercomplete with a DJ booth, helipad and hot tub for discerning buyers.
The company’s latest venture is The Row, an invite-only community of 30 properties. Everyrealm invited artists such as Daniel Arsham, Misha Khan and Alexis Christodoulou to contribute to the design. Alongside neoclassical buildings and gigantic cantilevers, there are alien shapes, unbound by the laws of physics, and digitally fulfilling the promise of his architecture.
“We give artists real freedom,” Yorio said. Her driving force, she added, is that “architecture is so important and exclusive that people look at it as a kind of high water mark.”
Yorio cites Everyrealm’s Fantasy Island project (100 private islands in a sandbox sold out in a single afternoon in August 2021) as an example of how these properties are valued. I’m here. They sold for about $15,000 each, but are now trading for about $100,000, down from $250,000 at the height of the cryptocurrency and NFT market boom in late 2021, the CEO said.
Buyers of The Row properties will be purchasing architectural plans in the form of NFTs that can be built and deployed on a variety of platforms.
“We want to stay true to the spirit of decentralization,” said Yorio, but the sales model also speaks to the uncertainty that stands in the way of investing in the metaverse. “It’s very difficult to know which metaverse will be the most popular one year from now, or five years from now,” she said.
With a development name inspired by Manhattan’s Millionaires Street, EveryRealm has hired elite New York real estate brokers Oren and Tal Alexander to oversee the sale.
Yorio said the Alexander brothers are currently looking for potential buyers and the private sale will begin in September. “We want to make sure the art reaches the right type of collector, not the people who want to buy NFTs and flip them and create that over-speculative dynamic.” she explained. The price was not disclosed to CNN.
Yorio disputed the notion that The Row is an example of a metaverse moving toward social stratification. “This is about owning one of the first seminal works of three-dimensional habitable art in a new medium, which says it’s building a country club where only 30 people can join.” I think it’s a completely different story,” she insisted.
The long-term value of a metaverse property can also depend on whether users work there as well as play there.
Dubai-based design studio Roar CEO Pallavi Dean has already done so by purchasing his own space in Decentraland. Dean purchased four plots of land in January 2022 for a total of about $60,000, hoping to showcase Roar’s work to clients. “You have to be really in the game before you can convince others,” she said. “We will record this as marketing funds.”
She has already moved some of her work to the Metaverse and hosts client meetings in Roar’s virtual office. In the coming months, she will be conducting training courses from the Metaverse boardroom.
Roar also aims to generate revenue in the Metaverse by building floating pods that could become NFT galleries, retail spaces and hotels. Dean admits he’s still waiting for his first rental and first NFT sale, but he’s optimistic about future growth.
Given the short lifespan and rapid acceleration of the metaverse, long-term forecasts are risky, especially when the real estate market is experiencing growing pains.But can Metaverse real estate be as reliable an investment as bricks and mortar? dot com bubble?
“It’s hard to know if real estate inside[the Metaverse]will be stable…at least we are very much into it,” Yorio said.
Many outsiders may view its long-term prospects with more than a little caution. Unsurprisingly, some people working in this burgeoning industry are still bullish.
“Metaverse real estate is very likely to be a stable investment in the future,” Robson of analytics firm Wetmeta said in an email.
“This is not a bubble,” argued Hoover, narrowing the metaverse down to a combination of two trends: gaming and blockchain, neither of which is trendy. “There’s an element of hype when you start zooming in. The price of land has tripled he in the last six months. It’s clearly driven by speculation. But this is a fleeting event.” Yes, it’s fixed now.”
“There’s a lot of hype going on[in the short term],” he added. “But that’s not what I’m into. I’m into macros. And macros definitely stay here.”