What is Micro-Real Estate? Micro-Real Estate is a few different things. Firstly, it is the name of this sub-domain on Leptonic, Inc.’s website. That’s the easy definition. The broader, hopefully more relatable definition, is a very small property on which a small piece of equipment can be placed to generate semi-passive income (or possibly truly passive income after a bit of set-up work).
Examples of pieces of equipment that would be placed on a micro-property are Electric Vehicle Chargers (also known as Electric Vehicle Supply Equipment (EVSE) or electric car chargers), vending machines of any sort, Automated Teller Machines (ATM), Helium hot spots, 5G nodes, parking spots, shipping container farms (for growing plants or even for growing mushrooms), digital out-of-home (DOOH) advertisements.
Opportunities for Growth
As this website has grown over the past year (and I along with it – heck, I’ve never thought about buying art from a vending machine before), the definition of micro-real estate has become a bit more lax, since we’ve included Ghost Kitchens and the “spots” – Parking Spots, RV Pads, and Boat Slips. So, we’ve changed the definition to be broader – a small piece of commercial real estate (CRE) that can be leased or sold to a vendor.
The intent is not for people to live on a micro-property – micro-real estate is not a smaller iteration of a tiny home or tube hotel. Micro-properties are usually on CRE in high foot traffic areas, so that many customers can interact with the equipment, or there is a high demand for a spot. There could even be temporary micro-real estate in the form of desirable parking spots for sporting events or concerts – we’ll have to think about how to add that feature.
So, if you haven’t caught the drift, this website is a work in progress and Leptonic is open to all suggestions – website features and content, new types of micro-real estate or hardware, marketing ideas, cool things to vend out of vending machines (surfboard vending machine on a beach, anyone?), potential funny advertisements – whatever.
Back to the Question at Hand – What is Micro-Real Estate?
A parking space ranges from about 250 to 350 square feet (which is not an unheard of apartment size in New York City), and parking spaces are in the medium-large range of micro-properties (only Shipping Container Farms, Ghost Kitchens, RV Pads, and Boat Slips are larger).
Electric car chargers and vending machines typically take up less that 10 square feet, and helium hot spots are approximately 1 square foot. So, even within the realm of micro-properties, there really is a lot of space.
We are Nerds
Just like the famous physicist Richard Feynman said when lecturing on directly manipulating small particles, “There’s plenty of room at the bottom.” Atoms are essentially 99% empty space, and even in highly developed cities, there is plenty of unused space. But unlike with atoms, with micro-real estate you can stack machines to make even more money.
For example, lets say you own a 4-floor office building on the outskirts of a small town. You could lease some of your parking space to a shipping container farm that could sell fresh fruits and vegetables to your employees on their lunch breaks or before/after work. You could also lease interior space to vending machine owners, and allow them to provide a variety of food and drinks.
The vending machine company could also supply 5g nodes on top of their machines to reduce cell service dead spots in the building. You could also lease space for electric vehicle chargers in the parking spots close to your building. The space on the roof could be leased to a solar panel or array operator. I hope that you get the picture: if you own CRE, you have foot traffic and people are willing to pay for access to foot traffic, just like people pay for website traffic.
Leptonic, Inc, has embarked on a mission to connect those who own empty space with those who wish to create income from a piece of equipment in a good location. Just like in traditional real estate, a lease agreement can be inked between the two parties and each can make passive income – the owner can rent out the property to a tenant who owns a piece of equipment that generate income from sales of vending products, or electricity, or WiFi access, or whatever makes sense for the space.
Benefits of Micro Real Estate
Owning and Operating Hardware
For owners and operators of machines and hardware, the barriers to entry (and growth) and capital requirements for micro real estate are significantly less than traditional commercial real estate. Semi-Passive income can be generated from the placement of machines and hardware on commercial real estate, so once the upfront work of finding a spot for the machine/hardware is complete, then the owner/operator can earn the equivalent of a high hourly wage.
Since a machine can bring in a few hundred dollars a month, and the owner/operate will likely only take a couple hours to refill the machine each month, it is possible to earn $50 to $200 per hour for the few hours the owner/operator is actively working.
Owning and Leasing Micro CRE
The benefits of Micro Real Estate for commercial real estate (CRE) owners and managers is that the income from micro-properties is almost truly passive. CRE managers do not need to hire additional staff to manage machines, as that will be performed by the company that owns the machines and hardware. Installation costs for things like electric vehicle chargers may also be covered by the hardware and machine owners – allowing CRE managers to provide a new amenity at no additional cost to themselves and increasing the value of their CRE property.
Transactions through Micro Real Estate Agents
Real Estate agents can also get in on the action by becoming Micro Real Estate agents. Why would a real estate agent want to deal with small transactions for vending machines and EV chargers, when their pay is based on a percentage of the sale price? Well, they could either automate their transaction process by using this website and assist with a lot of small transactions. Or they could create deals between commercial real estate properties that want many vending machines, EV chargers, shipping container farms, etc. in large buildings like hotels and apartment buildings, or even across multiple buildings owned by 1 CRE firm. That CRE firm would then need to make a deal through a Micro Real Estate agent with a large vending, EV charger, and shipping container farm company for the hardware and operation of the amenities.
Since the machines and hardware on micro-properties provide amenities to the CRE tenants, CRE managers can drive more business to their properties by promoting these new amenities (who wouldn’t want to watch a robot make them a pizza? or have a mini-art gallery of local artists?)
So, take a dive into the deep sea of micro-real estate – there’s plenty of room if you look.