How fractional ownership of assets works

An office building, a jet, a work of art. Few people can buy an asset like that on their own. Fractional ownership is the generic name for arrangements in which several participants share the same asset or the returns it generates.

The idea has gained new visibility with tokenization, which promises to split assets into very small parts. But fractionalizing does not depend on technology. Brazilian law already has several ways of doing it, and each one gives you different rights. This article explains these forms based on the rules in force on October 8, 2026.

Owning the asset or having a right to its returns

Before the details, one distinction settles most questions.

In some arrangements, you are a co-owner: your name is on the asset’s registration, alongside the other owners. In others, you have economic exposure: you receive part of the income or sale proceeds, but the asset is in the name of another person, a company or a fund.

Both can make money. The difference shows up when something goes wrong: in a bankruptcy, in a dispute among participants or when you want to get out.

Ordinary co-ownership: the undivided share

When two or more people buy a property together, a condomínio (co-ownership) is formed. Each of them holds a fração ideal (undivided share): a percentage of the whole that does not correspond to a specific physical part. The Brazilian Civil Code governs this arrangement in arts. 1,314 to 1,322.

The main rules:

• Each co-owner may use the asset according to its intended purpose and may “dispose of their undivided share, or encumber it”, that is, sell it or pledge it as collateral (art. 1,314).
• No one may change the asset’s purpose or let outsiders use it without the consent of the others (art. 1,314, sole paragraph).
• Each pays upkeep expenses in proportion to their share. If nothing is stated, the shares “are presumed equal” (art. 1,315).
• At any time, a co-owner may request division. The owners may agree to keep the asset undivided for up to five years, with a possible extension (art. 1,320).
• If the asset cannot be divided, such as an apartment, and there is no agreement, it is sold and the proceeds are split, with co-owners having priority over outsiders (art. 1,322).

There is also a right of first refusal on sale. For an indivisible asset, a co-owner may not sell their share to outsiders if another co-owner wants to buy it at the same price (art. 504).

Because it is real estate ownership, it is only transferred through registration at the Registro de Imóveis (Brazil’s real estate registry) (art. 1,245). In practice, ordinary co-ownership works well among a few people who know each other. With hundreds of participants, decisions and exits become difficult.

The term “fração ideal” also appears in apartment buildings. There, each unit carries, as an “inseparable part”, an undivided share of the land and common areas (art. 1,331, § 3). That is a different use of the same expression, not a fractional investment.

Multiproperty: dividing time

Law No. 13,777/2018 added multipropriedade (multiproperty), known in the market as time-sharing, to the Civil Code. According to art. 1,358-C, it is the regime in which each owner of the same property holds a fraction of time, with exclusive use of the entire property during that period, alternating with the others.

What the law establishes:

• The property is indivisible and is not subject to an action for division or for ending the co-ownership (art. 1,358-D).
• Each time fraction is at least seven days, consecutive or split. The period may be fixed, floating or mixed (art. 1,358-E).
• Multiproperty is created by an instrument registered at the Registro de Imóveis (art. 1,358-F).
• You can sell your fraction without the consent of the others. The others have no right of first refusal, unless the founding instrument or the bylaws provide for it (art. 1,358-L).

The law also applies Brazil’s Consumer Protection Code (art. 1,358-B). Multiproperty is, above all, a right of use. It was not designed as an investment.

Real estate fund shares: exposure without a property right

The fundo de investimento imobiliário (FII, Brazil’s real estate investment fund) is the most widespread way of fractionalizing real estate for investment in Brazil. Under Law No. 8,668/1993, the properties are held in the name of the administering institution, on a fiduciary basis and separate from its own assets (arts. 6 and 7).

The shareholder “may not exercise any property right over the real estate” (art. 13). You hold a fraction of the fund, not of the building. In return, the fund follows rules from the CVM (Brazil’s securities regulator) on disclosure, shareholder meetings and fees, detailed in Regulatory Annex III of CVM Resolution 175. The comparison between this model and tokens is in real estate tokenization versus real estate funds.

When sharing returns becomes a regulated investment

There is a line separating buying part of an asset from buying an investment. The CVM draws it based on the concept of a collective investment contract: an investment of funds, publicly offered, with an expectation of return that depends mainly on the efforts of others. The criteria are in CVM Guidance Opinion No. 40/2022.

The clearest example in real estate is the hotel sold in units. CVM Resolution 86 deals with the hotel CIC (collective investment contract): contracts offered to the public with a “promise of remuneration linked to participation in the results of a hotel venture” organized as a co-ownership (art. 2). The buyer may even have the unit registered in their name, but what they are after is the income the hotel operator generates.

The rule requires the offering material to carry a direct warning: “This offering concerns an investment in securities, and not merely the acquisition of real estate.” Mandatory risk factors include not making a profit, incurring losses and having to contribute additional funds.

For small companies, CVM Resolution 88 allows offerings through registered crowdfunding platforms, with limits. In the consolidated text consulted on October 8, 2026, an ordinary investor can invest up to R$ 20,000 per year in these offerings, and a company can raise up to R$ 15 million per year.

Where the token comes in

A token is a digital record, usually on a blockchain, that represents an asset or a right. Tokenizing means creating that record. In the definition used by the CVM, citing IOSCO, it is the digital representation of an asset or of ownership of an asset.

The token makes fractionalization easier: a digital record can be split into thousands of parts and transferred without paperwork. The final report by IOSCO on the tokenization of financial assets, from November 2025, lists fractionalization among the attributes tokenization seeks. The same report makes two caveats:

• Fractionalization “can already be achieved through traditional finance”, for example through securitization. The token is one means, not the only one.
• The promised benefits, especially secondary market liquidity, have not yet been clearly demonstrated in the cases analyzed.

The token does not change the legal nature of the right it represents. If it represents a contract for a share of rental income, you have a contractual right. If it represents a fund share, you have a fund share. Transferring the token does not transfer ownership of a property, which still requires registration in the property record. The topic is covered in does a token represent legal ownership of a property?.

Opinion 40 also states that tokenization itself does not require prior CVM approval. But if the token is a security and is offered to the public, capital markets rules apply to the issuer and the offering.

The forms side by side

Form	What you hold	Legal basis	How to exit
Ordinary co-ownership	Registered undivided share of the asset	Civil Code, arts. 1,314 to 1,322	Sell the share, respecting the right of first refusal, or request division
Multiproperty	Registered fraction of usage time	Civil Code, arts. 1,358-B et seq.	Sell the time fraction
FII share	Fund share, with no property right over the real estate	Law No. 8,668/1993 and CVM Resolution 175	Sell the share on the secondary market
Hotel CIC	Participation in the hotel’s results	CVM Resolution 86	According to the offering contracts
Token	Whatever right the contract defines	Depends on what the token represents	Platform or secondary market, if any

Problems that come up in any format

Some risks repeat themselves, whether the record is on paper or on a blockchain:

• Governance. With many owners, someone has to decide on renovation, leasing and sale. Ask who decides, with what quorum and what happens if you disagree.
• Exit. A small fraction of a large asset is hard to sell. Often the only buyer is another participant or the organizer itself.
• Costs. Maintenance, administration, taxes and platform fees are shared among everyone and reduce the return.
• Counterparty. When the asset is in someone else’s name, their bankruptcy or bad faith affects you. IOSCO cites the risk of the issuer keeping the asset on its own balance sheet and of the asset being sold without the investor’s knowledge.
• Loss. The asset may lose value, sit vacant or require additional contributions. You can lose part or all of the amount invested.

Key takeaways

Fractionalizing an asset can mean very different things. In ordinary co-ownership and multiproperty, you hold a registered property right. In fund shares, collective investment contracts and most tokens, you have a right to the returns, and the asset is in someone else’s name.

The token is a way of recording and transferring that right. It neither adds nor removes protection; the legal structure behind it defines that. Before any decision, find out whose name the asset is in and which rule governs the offering.