1. Identification of Opportunities

The success of Tulpea’s decentralized real estate financing model fundamentally depends on the quality of the underlying assets selected. Investment opportunities must be rigorously vetted based on financial robustness and stringent risk management criteria to ensure sustainable returns and capital efficiency. This meticulous selection process safeguards stakeholder interests and facilitates efficient debt structuring, asset tokenization, and enhanced secondary market liquidity.

Curator-Based Investment Sourcing

Tulpea's financing model aims to be fully decentralized, requiring Curators to source and manage investment opportunities. Curators, individuals or entities elected by the DAO, propose real estate investment deals and are required to stake tokens to demonstrate commitment.

• If a deal is successfully executed and profitable, Curators receive a commission.

• If a deal defaults, their staked tokens are penalized (slashed).

This incentivization structure ensures aligned interests and creates a truly decentralized investment ecosystem.

Tulpea's vision is to establish a global network of Curators spanning diverse geographic and sector-specific niches, enriching the DAO with a wide-ranging and continually refreshed selection of investment opportunities. This symbiotic relationship is mutually beneficial: Curators gain streamlined access to financing for compelling projects, and the DAO receives a diversified pipeline of carefully vetted investments.

Roadmap to Full Decentralization of Curation

Phase 1: Curation by Tulpea Core

• Initial phase with Tulpea Core as the sole curator, in order to validate the investment model and establish best practices through direct oversight.

Phase 2: Introduction of Elected Curators

• Decentralization begins, allowing DAO-elected Curators to leverage local market expertise and networks to identify and propose investments.

• Continued human oversight ensures adherence to strategic objectives such as diversification and stability.

Phase 3: Permissionless Curation and AI Integration

• Full decentralization is achieved once risk assessment model proves consistently reliable, enabling any individual to submit projects (even to finance their own residence) directly to the DAO. Curators will remain responsible for verifying asset legitimacy.

• AI agents will be deployed to automate the analysis of investment metrics, enhancing efficiency without compromising accuracy.

Real Estate Investment Thesis

Initially, Tulpea will exclusively focus on real estate before extending the financing model to other asset classes. Curators must ensure each proposed investment aligns with Tulpea’s core investment thesis, to ensure:

• Stability: Selection of perennial, resilient real estate assets.

• Risk Minimization: Rigorous scenario analysis, including worst-case outcomes.

• Profitability: Consistent revenue streams to service debt and equity returns.

Asset Structuring

Assets may be structured either as:

• Balanced Funds: Combining stable investments with opportunistic plays.

• Thematic Portfolios: Focused on specific themes (e.g., coliving, green logistics) driven by investor interest or asset outperformance warrants.

• Standalone Assets: Single-property investments offering simplicity in management and clear exit strategies.

Asset class	Example (non exhaustive)
Commercial	Class A offices (modern, downtown, strong leases), Secondary offices (suburban, repositioning potential), Coworking spaces, Medical offices, Gyms, Hotels, Conference centers
Residential	Multi-family buildings & urban rentals, Single-family rentals & standalone homes, Coliving spaces, Senior housing, Student housing, Short-term vacation rentals
Industrial	Logistics warehouses, Last-mile distribution centers, Cold storage, Light manufacturing, Data centers, Industrial parks
Retail	Neighborhood centers, Retail strips, Food franchises,

Geographic Focus

Preferred regions for investments include the EU, US, Asia, and the Middle East, specifically targeting high-demand locations with robust economic fundamentals:

• Population growth >2% annually

• High GDP per capita

• Vacancy rates <5%

• Proximity to economic hubs and robust infrastructure

Financial Selection Criteria

Curators must comprehensively document and source their financial analyses for each asset. This process begins with a macro-to-micro approach: starting with an evaluation of broader economic and demographic trends and then focusing on micro-level opportunities in undervalued neighborhoods with strong fundamentals, including low vacancy rates and proximity to economic centers. Assets should present three key characteristics:

• Gross Yield: 8-12% (initial screening)

• Cap Rate: 6-11%

• Vacancy: <5%, based on rental history and local benchmarks.

Asset Type	Cap Rate (%)	Vacancy (%)
Commercial	7-11	5-10
Residential	6-8	c.5
Industrial	6-8	<5
Retail	7-9	<5

Market tension indicators must also be considered, especially inventory months (less than six months indicate a tight market, while over twelve months suggest oversupply), modest annual rent growth (around 2%), and rental pressure levels (with concerns raised if rent exceeds 30% of disposable income). Investments should range from a minimum of $300k–$500k to avoid fragmentation and should not exceed 10% of the overall portfolio to prevent overconcentration. Single-ownership is preferred over co-ownership structures for simpler management and resale.

Risk and Liquidity Management

Curators' risk management framework begins with proactive external risk anticipation, leveraging macroeconomic monitoring of key indicators—including real estate indexes, interest rates, inflation, unemployment, GDP, and PMI—to anticipate economic shifts that could impact asset performance or financing costs. Locally, Curators must closely monitor zoning laws, tax changes, and regulatory shifts to ensure compliance and mitigate unforeseen burdens.

Operational efficiency is essential; therefore, Curators must guarantee effective day-to-day management either directly or by appointing seasoned property managers with proven track records (minimum five years).

To minimize portfolio volatility, Curators are encouraged to diversify investments across regions and asset classes. When selecting individual assets or thematic portfolios, Curators must explicitly detail their rationale. Utilization of fixed-rate debt is highly recommended to hedge against rising interest rates, along with maintaining a 5% cash reserve to manage unexpected shocks such as tenant defaults or market downturns.

Comprehensive pre-acquisition due diligence must be performed by Curators for each asset, including assessments of structural integrity, system inspections (HVAC, plumbing, electrical), and environmental risks (e.g., flooding, contamination). Curators must also thoroughly review maintenance history, including previous repairs, upgrades, and recurring issues, ensuring compliance with local building codes. Ongoing monitoring and annual inspections over a holding period of 5 to 10 years are mandatory, with continuous evaluation of regulatory compliance to optimize asset performance and longevity.

Furthermore, Curators must organize annual third-party valuations by independent experts to determine fair market value, considering current income streams, physical condition, and market trends. These valuations must be benchmarked against comparable sales data from industry-standard data

Liquidity is closely monitored by tracking the average sales timeline of comparable assets (targeting less than six months in tight markets) and annual transaction volumes, providing real-time insights to optimize exit timing. Additionally, Curators should monitor liquidity conditions on the peer-to-peer secondary market for tokenized debt and equity instruments, enhancing overall investment flexibility and market responsiveness. When the time comes to exit, assets are sold through specialized brokers or auctions to maximize value and ensure efficient capital recycling.

Target Performance

Curators should present projects with attractive performance metrics, otherwise risking rejection by the DAO:

• IRR of 9-13%: Ensures sufficient cash generation to reliably meet debt obligations and deliver attractive returns to borrowers.

• LTV of 70-85%: Strikes a balance between leveraging debt for higher returns and maintaining financial stability, with a conservative DCR (>1.2) to cover debt obligations even in downturns.

• Break-Even Ratio <85%: Provides a buffer against revenue drops, ensuring the portfolio remains viable under stress.

• Cash-on-Cash >5% by Year 5: Targets steady cash flow growth as assets stabilize and rents increase (+2%/year minimum), appealing to investors seeking income alongside capital appreciation.