Milwaukee's F Street Group is the developer behind local real estate projects including The 42 in the Brewery District, which houses MKE Brewing Co.'s brewery and taproom, among other local commercial spaces.
But the real estate development firm, led by president Scott Lurie, is also thinking beyond the physical realm. Late last year, the company purchased virtual land — and a virtual speedboat— in a metaverse called The Sandbox.
The company bought the assets — a form of non-fungible tokens (NFTs) secured through blockchain technology — through its new F Street Meta division, which is exploring "the next iteration of the Internet," said F Street Group vice president of marketing Mike Doney.
F Street paid roughly the equivalent of $200,000 for the virtual assets, Doney said.
"The land itself is sort of a blank slate," said Doney, who spearheads the firm's emerging technology initiatives. "Within our pixel-by-pixel area, we can build anything we want. ...We're still kind of exploring what we want to do with it."
F Street Meta is in the early stages of working with potential partners, outside investors and software developers to shape its metaverse plans, Doney said. The firm is brainstorming ways in which its metaverse endeavors could support its core real estate business, he added.
For example, F Street Group could build prospective physical buildings in the metaverse to give potential investors or future tenants a chance to experience spaces before they're constructed in the real world, Doney said.
"We want to be at that forefront of introducing new technologies to our clients and showcasing what's available," Doney said.
While F Street Meta may develop some of its virtual assets, it may hold others as investments in order to seek value appreciation, Doney said. For example, it believes its virtual speedboat could be valuable in the future as another area of the metaverse that's accessible by boat gets more developed, Doney said.
"We're learning, but we also believe we're making an investment," Lurie said. "We think the value of it is going to continue to go up."
F Street Group is bullish on web3- and crypto-based technologies in general, Doney said. Through its new F Street Blockchain division, it plans to sell blockchain-based tokens this year to raise $10 million for a new real estate project.
Under these new divisions — F Street Meta and F Street Blockchain — the firm is also considering investing excess capital into cryptocurrencies as a way to hedge against inflation.
"There is a goal at some point soon to begin treasuring some of our assets into crypto and generating yield on those assets as a way to give ourselves additional revenue streams," Doney said.
Specifically, it could invest extra cash in stablecoins, or non-volatile cryptocurrencies, instead of a highly volatile cryptocurrency like Bitcoin, Lurie said.
