What is a Delaware LLC?
A Delaware LLC is a limited liability company formed under the Delaware Limited Liability Company Act.
It is the dominant SPV vehicle for US tokenized real estate offerings, chosen for its flexible operating agreements, the Series LLC option, and a court system with deep precedent on commercial disputes.
Why Delaware
Delaware has built its economy around being the preferred jurisdiction for US business entities. Most US public companies and a large share of private investment vehicles are formed there, including the SPVs used for tokenized real estate.
The advantage is concentration of expertise. Counsel, courts, and regulators in Delaware see commercial disputes routinely, and decisions are written by judges who specialize in business law. Investors and lenders dealing with a Delaware LLC operate in a system they already understand.
The Operating Agreement and Member Flexibility
A Delaware LLC is governed by its operating agreement, which sets out who manages the entity, how decisions are made, how profits and losses are allocated, and what rights members hold. The Delaware LLC Act gives parties broad freedom to structure these terms to suit the offering.
For tokenized real estate, this flexibility is essential. The operating agreement defines how token holders are recognized as members, what voting rights they receive, how distributions flow to wallet addresses, and how the SPV is dissolved at the end of its life. The same structure can support hundreds of small holders or a single institutional partner.
The Delaware Series LLC
Delaware allows an LLC to be formed as a Series LLC, in which a single parent entity creates multiple separate series, each with its own assets, members, and obligations. Each series is statutorily ring-fenced from every other series under Delaware law.
For multi-property tokenized portfolios, this is operationally efficient. One parent entity covers administration and reporting, while each property sits in its own series with its own creditors, its own token class, and its own performance economics. Recognition of inter-series ring-fencing in non-Delaware courts is still developing, which is a real and disclosable risk.
Holding Property Through a Delaware LLC
A Delaware LLC can hold real estate in any US state, but the property itself remains subject to the law of the state in which it sits. Title, recording, transfer taxes, and landlord-tenant rules follow the state of the asset, while corporate matters affecting the LLC are governed by Delaware law.
For non-US property held through a Delaware LLC, additional considerations apply. The LLC may need to register as a foreign entity in the property’s jurisdiction, comply with local ownership restrictions, and address tax treatment for international investors. Cross-border structures often combine a Delaware LLC at the holdco level with local entities at the asset level.
Delaware LLCs at Node Proptech
Where a Node Proptech offering uses a Delaware LLC as its SPV, the operating agreement sets out token holder rights, distribution mechanics, governance procedures, and exit terms under the Delaware LLC Act. Cross-border offerings may pair a Delaware holdco with a local property-holding entity, each governed by the law best suited to its function. The structure gives investors recognized US legal status alongside enforceable rights against the asset itself.