Kenya’s capital market regulator has granted the asset management subsidiary of Britam Holdings Plc (Britam) a license that enables them operate a Real Estate Investment Trust. Britam is a diversified financial services group with operations in Kenya, Uganda, Tanzania, Rwanda, South Sudan, Mozambique and Malawi. The group has interests in the insurance, asset management and property sectors and one of their landmark investments includes a new 32 floor tower in the Upper Hill region of Nairobi that is set to become one of the tallest buildings in Africa.
Speaking after receiving the licence, Britam Asset Manager’s Chief Executive Officer Kenneth Kaniu said the company’s retail and institutional investors now have the opportunity to invest in real estate as a viable investment option as REITS allow anyone to invest in portfolios of large-scale properties the same way they invest in other sectors. Kaniu also noted that the company will be looking to offer REIT Schemes that will be listed to trade at the Nairobi Securities Exchange.
Stanlib, who received their licence from the Capital Market Authority (CMA) in October 2015, launched Kenya’s first REIT (Fahari I-REIT) in November 2015 and raised Sh3.6 billion against a target of Sh12.5 billion, representing a 28.8% subscription. Fusion Capital, a real estate developer and private equity firm also attempted to float a REIT last year after receiving their license but was unsuccessful due to low subscription amount.
The CMA’s actions are part of efforts to deepen and develop the capital markets by facilitating diversification of products available in the market. Paul Muthaura, the Chief Executive Officer of the CMA explained:
“We are pleased to advise that the authority has approved the grant of a REIT Manager licence to Britam Asset Managers Limited. This licence will remain in force unless otherwise suspended or revoked following the necessary due process.”