Mark Bonner: 00:09

Alright. It's Friday. Welcome to First Draft Live. It's July 18. I'm your host Mark Bonner, BizNow's editor in chief and I'm coming to you live from New York.

Mark Bonner: 00:18

I want to thank all of our audience from tuning in from across the country and around the world. Thank you very much for making the time. We're coming to you at the end of Crypto Week on Capitol Hill where congress just passed three landmark bills that could finally give digital finance real rules and real estate a brand new financial toolkit. Bitcoin blew past a 120,000 this week and the infrastructure is already being laid for stable coin leases, crypto backed loans, and tokenized LP stakes. So, on today's episode, has real estate's crypto moment finally arrived?

Mark Bonner: 00:53

The genius act sets ground rules for stable coins. Full reserves, monthly disclosures, and bank level approvals which makes them viable for things like escrow, cross border rent, and more. The Clarity Act settles the turf war between the SEC and the CFTC. A crucial move toward formal crypto oversight. And Trump's pro crypto agenda is now putting real pressure on real estate.

Mark Bonner: 01:17

To figure out what's hype and what's actually coming down the pipe. Joining us to make sense of it all, Gabe Marins, vice chairman at Savills. Gabe has led more than 20,000,000 square feet of tenant rep deals for companies like Duolingo, Unity Software, Expedia, and Bitwise. But wait, you may be thinking, isn't this guy just a broker? What in the heck does he know about crypto?

Mark Bonner: 01:42

Well, as it turns out, quite a bit. Many of Gabe's clients have been on Capitol Hill this week working directly with lawmakers and the White House as they shape this trio of bills. And in the you eat what you kill world of brokerage, Gabe has been gobbling up everything there is to know about crypto. Gabe, welcome to the show. I know you're joining us from the New York Suburbs.

Gabe Marans: 02:04

Yeah. Thank you, Mark. That's a heck of a introduction. Very much appreciate it. Could not have timed this better, for Strap Live.

Gabe Marans: 02:13

I think this is the first podcast that I've, that I know about that's, actually lined up to address this very dynamic week that we saw in DC, something that many of us who have been observing from the sidelines have been very excited about. Know, as of last night, some exciting new developments.

Mark Bonner: 02:32

Absolutely. I mean, let it be First Draft Live that takes you on the maiden voyage into crypto and real estate. But before we jump in to the intricacies of these three bills, Gabe, how did you get entrenched in this world to begin with and why?

Gabe Marans: 02:47

So putting aside the general curiosity that I have with crypto or any other nascent technology, several years ago, so about two crypto winters ago, I was introduced to a gentleman who was running a PR firm for one of the early crypto businesses. And it was not yet quite in the spotlight, spent a lot of time with me walking me through some of the details of the industry. And I wouldn't say that I wasn't skeptical. I think it's natural to be skeptical. Perhaps because I was a skeptic, I was asking a certain level of questions.

Gabe Marans: 03:27

And that relationship turned into many introductions to many of his clientele. And you blinked and you missed it. And all of a sudden now I counted a number of crypto tenants within the New York world as my clients advising them on office space and real estate. And so you survive a couple of crypto winters as a result of that. You grow the book of business.

Gabe Marans: 03:51

And to this day, I have several very treasured clients that are in the broader crypto space, both mainstream and also more of a challenger set. And that's who you were referencing. Those were the folks that have been playing a role in DC over the last year plus and more intensively over the last several weeks and months, helping to craft and advocate and lobby for these three critical pieces of legislation.

Mark Bonner: 04:18

Yeah. If you go to biznel.com, this is a message to our listeners and our viewers right now. And we've a big story on the front of the website right now that breaks this all down. But Gabe, what are your what are your contacts in DC telling you right now that is in terms of these three bills? What is the single most important shift for CRE this week?

Mark Bonner: 04:35

Is it stable coin clarity? Is it token classification? Or is it a blocked Fed coin?

Gabe Marans: 04:42

Yeah, it's certainly the Genius Act, which was the, I think in my view, the most important of these three bills from a real estate standpoint. Know, this is the bill that was passed by the Senate earlier this year. It was passed by the House late yesterday, and at some point should be going to President Trump's desk for signature and signed into law. And what this essentially does is it clarifies a lot of the uncertainty that existed around stablecoins. This is not introducing stablecoins to the market, but it's clarifying a lot of the uncertainty that was hindering its growth and its adoption in a way that, as we'll talk about over our next few minutes here, will have a very real and sooner than most people realize impact on the entirety of the real estate ecosystem and beyond.

Mark Bonner: 05:34

So at this hour, the Genius Act is headed to the president's desk. Stablecoins, therefore, as you said, could soon be approved for regulated use, giving CRE companies a new set of tools for rent payments or deposit flows or escrow handling, even tokenized investor returns. Gabe, do you think a regulated stablecoin could be integrated into CRE workflows by the end of the year?

Gabe Marans: 05:58

Yeah, I think it's most certainly likely. There are certain provisions that are buried within the Genius Act that allow for a timeline for things to be further clarified. So I think the safest guess or the safest timeline to assume would be about twelve months from now, where we'll have it more firmly in focus. But I think that by the end of this year, you will start to see a lot more of that. And I know that we're speaking about stablecoin to the extent that not all of your listeners are familiar with stablecoin.

Gabe Marans: 06:30

Stablecoin is essentially a cryptocurrency that is pegged to the US dollar frequently. And you could see in the background noise on bond sales purchasing treasuries that are the ones that are backing up the pegging of the currency with a stablecoin to the US dollar. And so when we talk about stablecoins, we're essentially thinking about it very simply as a one to one value to the U. S. Dollar.

Mark Bonner: 06:56

Who do you think are the early candidates to pi out the stablecoin integration?

Gabe Marans: 07:02

I could see this going one of two different ways. I could see the institutional players that are looking at this as an opportunity to be more competitive in the market. And I could also see this as an opportunity for more of the challengers, the players that are on the fringes to eat up market share. And to more directly answer that question, what is the opportunity that exists to take advantage of that opportunity within the market? Why would a player right now try to embrace stablecoins?

Gabe Marans: 07:32

Well, you have to understand that right now if you are settling a sale, if you're transferring monies certainly across borders, you're dealing with two major friction points. The first is time. It often takes many days in order to settle certain sales, trades, money transfers. And the other part of this is fees. There are significant fees that are associated with transferring money through the traditional banking system.

Gabe Marans: 07:57

It's partly why you've seen some resistance from many of those traditional players and why, if there are any big losers out there right now as a result of this act and some of these other acts, it may very well be some of the established financial players if they're not able to pivot and respond and take advantage of this legislation, which they're smart, very smart players. I think they end up will be doing so. So going back to the question, the advantages here is you can settle trades, settle sales a lot faster. We're talking about almost instantaneously. And the other component to this is because stablecoins based on the Genius Act, you're not allowed to charge interest on them.

Gabe Marans: 08:37

There is a situation here where the fees are going to be significantly less. There might be a single fee associated with it, but it's going to be significantly less. And so if you are a big bank or you're a challenger in the field right now, and you could look at this and see that you can accelerate your timeline for deal making and also reduce your costs to transact. Those are major advantages and that's what drives the industry at large. And that's why you're going to see, once you have this better understanding of how this is all going to work, you're going to see a rush towards it, I think both on the challenger side and on the institutional side.

Mark Bonner: 09:13

Look, just looking at The US map, I mean, The United States is flush with markets that our innovation in tech hubs, all with large institutional portfolios and tech forward adoption, Dallas, New York, San Francisco. I mean, do we think those are the places where we're going to start to see this unfurl first?

Gabe Marans: 09:32

Yeah, I think that, and listen, I'm calling in from the New York suburbs here. I'm New York born and raised. So, I am naturally biased towards New York. It's the perfect environment for this confluence of technology and finance. And so, yes, you're going to see a major embrace of the technology that's going to be coming out of New York.

Gabe Marans: 09:54

I also think you're going to see a lot of companies emerge that will be taking advantage of this new legislation in New York. I think San Francisco and the Greater Bay Area, just simply due to their history as a bastion of innovative thought and technology, going to see innovation over there. And Texas, specifically Dallas, I know they're trying to make the Yall Street thing stick. I don't know if that's actually going to be successful. But it's undeniable that you're starting to see this migration of financial services to that part of the country helped along with their business friendly default insistence on having less regulation in that market.

Gabe Marans: 10:32

And of course, Southern Florida. You're gonna see elements of that there, too. The biggest knock against Southern Florida is you just don't have the same degree of labor migration and the densification of the right labor that you would need for financial services innovation. But in the other three major markets that we just mentioned, I think that's where you're going to see this mostly concentrated.

Mark Bonner: 10:57

Yeah, Y'all Street, I mean, they're least winning on the branding. That's amazing. Let's talk clarity just for a second. The Clarity Act offers long sought guidance on which digital assets are commodities versus securities and who regulates them. For commercial real estate, could unlock new potential for tokenized LP stakes, equity tranches and smart contract based settlements.

Mark Bonner: 11:20

But Gabe, are firms ready? Is it still a future bet or is it something that we can do now as an industry?

Gabe Marans: 11:27

Yeah, I think it's a future bet. And so what the CLARITY Act is designed to address is a lot of the headwinds that many crypto businesses have been confronted with over the last several years, particularly over the past presidential administration, where there was confusion about the classification of the crypto product. Is it a security or is it more of a commodity? And the major difference there from a legal standpoint is, is it going to be monitored by the CTFC, the Commodities Future Trading Commission, or

Mark Bonner: 12:05

is

Gabe Marans: 12:05

it going to be closely tracked by the SEC? And that's a major difference. And there are several very well publicized instances where companies got into trouble because the classification was not clear. And there was this battling between one agency versus the other. In some cases, they were being targeted by both of those agencies.

Gabe Marans: 12:28

What the CLARITY Act is designed to do is provide clarity on what fits into which category because that has been holding back innovation in this department because of the threat of lawsuits and legislative action. And so, I think that this is going to play a very sizable role. It is further from going into becoming true law than the Genius Act. It still needs to pass the Senate. It passed the House.

Gabe Marans: 12:57

It now needs to go back to the Senate. And what I'm hearing from several of our clients who are on the Hill and talking to Congress, talking to the Senate, the Senate has quite a number of changes that they would like to implement compared to the House version. And so, I think it's a little bit further than most people realize, but I am optimistic simply because historically over the last half a year so far since Mr. Trump has reentered office, he's passed almost everything that has been a campaign promise. So I would put my money that some version of this ends up getting passed by the Senate and returned to the president's desk for signature.

Mark Bonner: 13:39

If you're just tuning in, it's Crypto Week on Capitol Hill, and we're talking about what it could all mean for commercial real estate. With us is Gabe Marins of Savills, breaking down how tokenization, stablecoins, and regulation could reshape the capital stack. So let's move on to the anti CBDC act, which would block the Federal Reserve from issuing a digital dollar. Supporters argue it protects privacy and innovation. Critics say it limits the modernization of The US financial system.

Mark Bonner: 14:06

For commercial real estate, a digital dollar might have streamlined wholesale transactions, escrow handling, or cross border financing. Without it, private stable coins now hold the spotlight. But the public infrastructure piece may lag. Gabe, would a CBDC have helped or hurt real estate capital markets?

Gabe Marans: 14:29

So this is exactly what this bill is trying to address here. And at its core, it is an argument that innovation should belong within the private sector as opposed to the government sector. And so, the reason for the push for the anti CBDC bill is a result of concern that the government is going to abuse privacy privileges. The government, as a result of it becoming the owner of this corner of the financial services world, is going to inhibit innovation from other upstarts. And so the whole goal of this is to say to the government, hey, your job is to regulate and to establish guidelines for the private sector to innovate around this product.

Gabe Marans: 15:19

So, I think that it's important to note, which we haven't yet spoken about, that while we're talking about Trump and this being a campaign promise of his and how the Republicans have been touting Crypto Week, the Genius Act was passed with bipartisan support. And there's pretty wide bipartisan support for all three of these bills. It's, of course, the devil is always in the details. And so I think even now amongst Republicans, Democrats, and independents, there's a strong desire for innovation within crypto to stay within the private sector.

Mark Bonner: 15:54

You bring up a good point. I mean, although there were some loud yells from certain quarters of the Democratic Party that this was a really bad thing, 100 Democrats did cross the aisle and support at least a few of these bills and a lot of the language that was in them. Just going back to CBDC just for a second, Gabe. I mean, will institutional investors trust regulated stablecoins more now, or do you think they'll still see them as risky?

Gabe Marans: 16:21

Yeah, this was a conversation I was having just the other day with my team. We set up a debate on the team, And we played a bit of a devil's advocate argument here. And Ethan, to my left, was arguing that there's going to be faster adoption. And Maxine, on my right, was arguing that there was going to be slower adoption. And I was trying to play judge just to understand what the outcome was most likely going to be, of course, in anticipation of this conversation with you, Mark, and of course, before the Genius Act was passed by the House.

Gabe Marans: 16:55

And I think what I've arrived at, and it's true of all three of these acts, all three of these bills, that the biggest issue here has been uncertainty. And so once you shine that spotlight on everybody who's playing in this sphere, you're going to have a race towards adoption because the business cases are so obvious. Again, going back to what we were talking about earlier, we're talking about lower fees and faster transaction with the lower threshold of concern around the government pursuing lawsuits against your business. If you put all of that together, why wouldn't they accelerate into it? Now, some will walk before they run, But once everybody else, it's like, you you're in a crowd, everybody starts running in one direction.

Gabe Marans: 17:44

It's human nature to just start running with everybody. And so I think if you think about that image, that's what we'll see. Some people start walking, but once the mass starts running, so too will everybody else.

Mark Bonner: 17:56

I mean, you bring up a great point, right? I mean, do you think current commercial real estate teams are ready to reskill for this? Does this create new sectors within larger teams? Like, how is commercial real estate going to absorb this and take it on?

Gabe Marans: 18:12

So I don't think commercial real estate is ready by any means. I think that there's going to be a cottage consulting industry that's going to pop up that will help advise real estate executives on how to embrace this and how to incorporate it into their business models. And I think that there's some fallout as a result of some of the malpractice or underwhelming ethical showcasing of some others in the crypto world. I think Sam Bankman Fried and everything that happened with that, I think that stuck with people. But that is the old world.

Gabe Marans: 18:48

Now we're talking about the new world. What most people don't realize is almost every major bank is exploring crypto, blockchain, stablecoins, how to incorporate this. All the major wealth advisors have now allowed either explicitly or implicitly the investing of cryptocurrency on their platforms. You have many businesses now that are offering mainstream businesses that are offering ETFs that track cryptocurrency. And so this is an established field and world right now.

Gabe Marans: 19:18

And the real estate world as a historical business is always slow to adopt. But there's such a clear argument here about why some of the results of these three bills are going to be very clear. It's gonna help the bottom line. They just don't have that internal know how. And so how and why they go ahead and get it, I think that's gonna be a fascinating part of the next six to twelve months, but it is 100% going to happen.

Mark Bonner: 19:46

Okay, Gabe, let me go to a question from the audience. My partners and I are building a platform focused on tokenized funds in the real estate vertical. And one of our biggest challenges is getting real estate people to embrace crypto wallets. How do you see that working with stablecoins and the education piece?

Gabe Marans: 20:04

So now that we are past the passage in Congress of the Genius Act, most of which revolves and addresses stablecoin and also offers guidance about custodian wallets and some of the security and risks associated with that. I think that you are talking about one day later a much safer environment than maybe if we were having this conversation forty eight hours earlier. But there has to be an educational element to this. Even the major news publications, and Mark, I tip my hat to you for having this podcast so soon, this is not being investigated, understood in the same way that it really needs to be. And so if you are already tired of this topic, steel yourself because you're going to be inundated with many, many takes over the next several weeks.

Gabe Marans: 20:49

This, of course, being the first and the most important and the most accurate. But there will be others to come. So I think the answer to the question is it's going to take a little bit of time. But again, comes back to there being clarity and not with the bill. But there is more certainty, less uncertainty around this.

Gabe Marans: 21:07

And as people understand that this is the new world, that this is the future, there's no turning the clock back on this, you'll start to see more of an understanding around why your product and your company is going to be a key part of the ecosystem.

Mark Bonner: 21:20

Yeah. And Gabe, I mean, as you well know, I mean, is an industry that for decades has been a little bit anti technology adoption, right? And then, over the course of last five years, you know, whether it's AI or any number of things that have entered the four, you know, commercial real estate is trying to shake off that stereotype, right? Lot of fears out there about, you know, things like AI and perhaps even crypto killing jobs. You and I were talking earlier about the ludite fallacy.

Mark Bonner: 21:50

Do you think this is a job killer or is it a job creator? Like, how do you view this in terms of the longer stretch of time in the next couple of years once we get beyond the consultancy phase?

Gabe Marans: 22:00

I think this is a net gain of job creation for a very simple reason, which is this is going to introduce an even faster pace of doing business because of the timeline that it's going to take in order to the shrinkage of that timeline, the lowering of those fees, those monies, if you're a business and you're not paying as much in fees in order to settle trades or sales, where does that money go? That money is going go somewhere and at least a portion of that is going to go to additional job creation. And as the pace of business starts to pick up, they're gonna need more people in order to help facilitate and assist with that. And so I think that it's a near, mid, and long term net gain for jobs.

Mark Bonner: 22:46

The road to mass adoption is probably going to depend on who builds what. Wallets, custodians, smart contract registries, and compliance layers that must come online, and someone must prove ROI. What do you think is the realistic adoption curve for crypto tools in commercial real estate? One year, three years, five years, Gabe? Like how do you see this playing out?

Gabe Marans: 23:10

I think you'll start to see some players within the next six months start to embrace them. You'll probably see a breakout of a major player within the first year. I think we'll then start to see a slowly increasing cascade of players embrace this to some degree or another. So I think you're probably talking about three or four different time periods. I pegged the first two at six months, then a year.

Gabe Marans: 23:39

Maybe the second tranche happens at two years. I think we'll be looking back on this in another ten years and wondering how we were still settling real estate transactions that were not on the blockchain, that were not pegged to stablecoin. All of this, of course, assuming that there's not a big scandal that poisons everybody's sense that this is a safe and secure way of doing business.

Mark Bonner: 24:02

So, I mean, just to drill down just a little bit more, Gabe. I mean, who needs to move first? GPs, LPs, brokers, lawyers?

Gabe Marans: 24:11

You'll probably start to see LPs and GPs move first. Lawyers will be, I think, part of this cottage industry with expertise about how to best take advantage of this. You'll start to see some really dedicate themselves to understanding how to effectuate some of the changes that are outlined within the Genius Bill and hopefully over the next two bills. But it's going to be a GP that fancies themselves as a new player on the field. You'll probably have some LPs, many of whom have existing holdings to a sizable degree of cryptocurrency and believe ideologically in the future of the blockchain and Web three.

Gabe Marans: 24:54

You know, I don't think I ever thought I would see a point in time where a professional sports player would choose to take some of their salary in Bitcoin. We've seen that over the years. It still hasn't become mainstream, but it is not as wild of an idea as it once was. But I think you'll start to see more massive adoption within the real estate space in a more mainstream capacity. But going back to your question, it'll be some individual GPLP.

Gabe Marans: 25:21

A journalist will find the story, find it compelling, topical, write about it, and others will then start to copycat.

Mark Bonner: 25:29

Yeah, I think what we've learned in the last twenty four to forty hours is that we're officially past the hype phase. This is here. It's not going away. This week, these laws, assuming that Donald Trump signs them, real laws, real framework, real potential. But as we've discussed, real risk looms.

Mark Bonner: 25:48

Tech, compliance, market immaturity. Gabe, if you're advising a CEO today, what's your play book? Go now, go small, wait for proof. What are you telling a CEO today?

Gabe Marans: 26:02

Yeah, I'd say immediately start exploring partnerships. You're going to want to think about piloting stablecoin based transactions and maybe some non core assets so that if something goes wrong, it doesn't impact your direct or your most important critical business line. And really watch regulatory guidance very closely. I think we're going to see a lot more come out over the next six to twelve months in a way that will help shape and guide all of this. Absolutely avoid unregulated tokens or platforms.

Gabe Marans: 26:33

You're going to want to focus on use cases with clear legal pathways. And through it all, be very mindful of the benefits, the ROIs, as you said. Measure the cost and time advantages and lean into the ones that are going to have the most positive effect on your business.

Mark Bonner: 26:51

We're running out of time here, Gabe, but I want to jam in one more question from the audience if you have a second. Question, do you think that US to US based transactions will want or need this for deals since banking fees for wire transfers are not that expensive and time delay is not overtly significant?

Gabe Marans: 27:12

If we are defining fees as not that high and time delay is not that significant, well, what would it look like if you were to cut that in half? What if you were to take a 3.5% fee and shrink it to almost nothing or take a three day timeline to settle a transaction and turn it into something instantaneous? This is what we're talking about with stablecoins. We're talking about not having to go through the traditional finance system. And time not only kills all deals, but if you can do them faster, of course, the inverse is also true.

Gabe Marans: 27:46

If you can do things faster, time will save deals. And so, yes, I think those are the two major reasons where you can save on both time and money. And that's exactly the reason why you're going to see a strong interest in how do you integrate this new technology into the existing business models.

Mark Bonner: 28:06

Okay, I'm getting the hook, Gabe, from my producer. That's all the time we have today. Thank you very much for being here.

Gabe Marans: 28:12

Yeah, thank you, Mark. Really appreciate you having me. Fantastic talking about something that we're really in the early innings of.

Mark Bonner: 28:21

We'll be back with another episode of First Strap Live next week, so don't miss out. You can sign up now on our event page. Can also find today's episode and all of our past conversations on your favorite podcast app and also at biznow.com. This is First Draft Live. Have a great weekend y'all.