Home Afrika chairman Lee Karuri (right) with acting chief executive Njoroge Ng’ang’a during a business update breakfast at the Serena Hotel on September 5. Photo/SALATON NJAU
What you need to know:
Home Afrika has notified the capital markets regulator of its intention to raise capital through the newly introduced real estate investment trust (REIT)
The recently listed firm also has plans to sell some of its completed projects to the public through investment REITs
Home Afrika has notified the capital markets regulator of its intention to raise capital through the newly introduced real estate investment trust (REIT), setting it on course to possibly becoming the first company to tap the bourse for construction cash.
The recently listed firm also has plans to sell some of its completed projects to the public through investment REITs, in a move that would unlock cash for it to put up new projects.
An investment REIT allows sale of an existing property through the bourse while a development REIT is used to raise funds for new developments.
“Home Afrika Ltd is planning a development-REIT for five construction projects and an investment REIT in the next few years.
The company uses most of its capital to buy land,” said the Capital Markets Authority in its quarterly bulletin for up to September.
The company’s shareholders gave its management the go-ahead to set up the REITs during the annual general meeting held in July. NIC Capital has been appointed transaction advisers.
One of the projects expected to benefit from the issue of a development REIT which allows real estate developers to raise money from the public to execute the project is Migaa Project in Kiambu County.
The Migaa project comprises of 4,000 homes, hotels, schools, a hospital, offices, an 18-hole golf course, a commercial centre spread on 774 acres.
Other projects lined up by Home Afrika include Kikwetu Project on 1,000 acres in Machakos, Lakeview Heights in Kisumu and Llango in Kwale County.
The company completed projects viable to be sold to the public through the investment REIT include the Morningside Office Park on Ngong Road, Nairobi, and Mitini Scapes in Migaa.
The park has 36 office suites and offers basement parking, roof top gardens and conference facilities. Mitini Scapes is a residential project completed in June with 250 houses on 14.4 acres of land.
The National Social Security Fund has also declared interest in use of the investment REITs to exit some of its real estate projects and reduce its investment in immovable property, which currently exceeds the regulatory limit.
PAYE Tax Calculator
Note: The results are not exact but very close to the actual.
