IPSX: the world’s first regulated stock exchange dedicated to real estate initial public offerings

IPSX is the world’s first regulated stock exchange dedicated to initial public offerings and the secondary market trading of companies owning single or multiple real estate assets, giving property owners access to a wide pool of international investors.

We spoke to Roger Clarke, Managing Director and Head of Capital Markets at IPSX, about the company's plans for rolling out further exchanges across the globe and why the UK was the obvious place to launch its platform. 

What does your company do?

IPSX is the international property securities exchange. We are a new stock exchange based here in London and the UK's seventh recognised exchange. We were founded five years ago now.

It took a while to get our full regulatory approvals from the Financial Conduct Authority – quite rightly that bar is set very high. We all benefit from the fact that the FCA has a tough reputation in approving new markets. That now means we are bringing a degree of liquidity, transparency and regulatory protections to a new asset class – real estate – for the very first time. We are the only regulated stock exchange in the world doing this.

We provide owners of real estate with the ability to list their buildings on the stock exchange as equities. That gives owners of real estate access to a wider source of capital and it gives investors – right down to the man in the street – access to a product class which hitherto has been out of their reach.

At the time of this interview, we are about to launch our first IPO in the next few weeks and we have a big pipeline of many, many assets worth together several billion pounds.

We are different from traditional Real Estate Investment Trusts (REITs) in that we can give investors exposure to single buildings. With our exchange, you can now choose exactly  what type of asset  you want to invest in.

Tell us about your UK and global operations.

IPSX Group is our holding company and will, in due course, operate property exchanges internationally. It is based in London in the West End.

Our first market is here in the UK and the UK recognised exchange, which is owned by the group, is based in Guildford in Surrey. Our compliance staff, our market regulation staff, surveillance, operations and our data management systems are all based in Surrey.

We currently have 12 UK staff based in Guildford and five people in the group function who are based in the London office.”

The UK's appeal goes far beyond the wide range of investor types that there  are in London. To set up a stock exchange we need a diverse array of skills such as compliance expertise, data management, IT, software development and settlements. All of these things are absolutely engrained in the UK.

What are the main benefits to being based in the UK?

There is a long history of financial innovation here in the UK. For us as a real estate market, our customers are owners of real estate assets and investors. So we are appealing to a combination of REITs, property companies, private equity, sovereign wealth funds, private banks and family offices. Many of those areas of financial markets emanate from London.

But the UK's appeal goes far beyond the wide range of investor types that there are in London. To set up a stock exchange we need a diverse array of skills such as compliance expertise, data management, IT, software development and settlements. All of these things are absolutely engrained in the UK. The UK's great strength as a financial market is often not the front office that the media tends to focus on but this middle and back office.

What we are trying to do is bring real estate markets together with the financial markets. London is the most important European centre of real estate trading – 40% of all real estate transactions in Europe happen in the UK – and it is also the most important centre for the asset management industry in Europe. So the only place where our innovation could ever have been proven as a concept was here in the UK.

English language and English law are also great strengths. The fact that when you buy a piece of real estate here in the UK you know it won't be appropriated is pretty powerful for a lot of international investors.”

What we are trying to do is bring real estate markets together with the financial markets. London is the most important European centre of real estate trading and also the most important centre for the asset management industry in Europe. So the only place where our innovation could ever have been proven as a concept was here in the UK.

Tell us about your company's growth ambitions.

 In due course our plans are to roll out this market infrastructure globally. Real estate is a huge global asset class worth tens of trillions of pounds with an investible stock all over the world.

Our plans are to have an IPSX exchange in mainland Europe and then eventually in Asia and probably in North America. This will see us opening further offices in these jurisdictions as we expand. We will be a global business with our group headquarters in London.