Groom Land Provisional Patent Application “Creating a standardized, automated marketplace for the purchase and sale of profit interests in undeveloped land including standardized lending secured by such interests and recorded on a distributed ledger system”.

Groom Land has two primary innovations:

  1. Proprietary system of facilitating a market for the purchase and sale of undivided minority interests in land. This is an automated, standardized system designed to increase liquidity in the market for undeveloped land by creating a third-party marketplace of standardized trading units based making land sales more like commodity sales. Sales and Loans against sales will be recorded on the distributed ledger system known as blockchain. The unique feature of this system is that the buyer is buying solely a portion of a revenue stream, in the form of land revenue units (LRU), completely detached from costs or other liabilities.
    • Land owner sets sale price and amount of revenue stream they’re willing to sell, such interest cannot be more than 49%.
    • An LRU cannot be sold is there is an existing mortgage lien against the property, and in order to sells LRUs a land holder must purchase a title report through the platform.
    • System only accepts posting if all info is entered and if seller warrants info as correct.
    • All documents pertaining to the land revenue units are the same, much in the same way that stock sales are standardized online. Land, just like stocks in companies, will be very different from each other, but the process of buying, selling, settlement, accounting, and margin loans is the same for all stocks.
    • The platform charges a standardized commission, 5%, based on a percentage value of the sales price.
    • System can accept land held in different formats like sole ownership, partnership, LLC, corporation, and create a standardized revenue interest.
    • Manual review of transactions takes 1 day
    • Minimum transaction size of $10,000
    • Special share class is created that has no capital contribution obligation, no liabilities, like a share of stock.
    • The shares are based on revenue, not profits, so the percentage of revenue generated is what a revenue unit is based on.
    • The revenue unit serves as first lien on the property, and a loan that generates cash is the same as a sale in terms of entitling the LRU holder to payment.
    • Units can be traded on 3rd party marketplace.
    • The platform places a standardized lien on the real estate for the benefit of the revenue holder.
  2. Unique systems for facilitating loans collateralized with undeveloped land and 3rd party marketplace for securitized loans
    • Standardized loan documents with state by state adjustments
    • Platform provides proprietary system for providing information for the loan process
    • The platform places a standardized lien on the real estate for the benefit of the revenue holder.
    • Proprietary algorithm for estimating land values can be used to estimate amount of loan
  3. Unique business systems and processes to facilitate the trading of land and services related to land and land development.
    • Integrated mapping of diverse news sources

    • Industry specific maps
    • Proprietary algorithm for estimating land values

    • Proprietary system of facilitating bidding on development related services by providing prepopulated data, including loans
    • proprietary public and private messaging system based on physical locations

    • Proprietary calculators specially designed to be useful to land investment decisions