ILAM Fahari Reit was listed on the NSE unquoted securities platform on July 10,2024 at Sh11 and continues to trade around the same mark according to the entity’s manager.
Over 4,000 retail investors have retained their investments in property fund, ILAM Fahari Real Estate Investment Trust (Reit) despite a restructuring process that sought to edge out the non-professional investors.
The individual investors have been bundled into a nominee account, allowing the Reit manager—ICEA Lion Asset Management Limited to abide by the rules of restricted real estate trusts.
“We made an offer to retail unit holders during the redemption process. For various reasons, we still have a significant retail investor base of more than 4000. There are unit holders who wanted to say. We were also unable to reach some of the retail investors during the redemption process while others could not take advantage of the process last year. We have committed to providing the liquidity needed for such retail investors,” ICEA Lion Asset Management chief executive officer Einstein Kihanda told this publication in an interview on Monday.
The Reit manager bought out retail investors at an 83.3 percent premium of Sh11 per unit last year while subsequently delisting the entity from the Nairobi Securities Exchange (NSE) main segment in a quest to address multiple challenges in the trust including the depreciation of its share price.
Retail investors who wished to remain invested had an option to top-up their unit holdings to meet the professional investor threshold of Sh5 million.
Non-professional unit holders are collectively placed in a bundled nominee account to keep the Reit in compliance with regulations but hold the same number of units owned before delisting, while their rights remain the same including participation in future distributions.
ILAM Fahari Reit was listed on the NSE unquoted securities platform on July 10,2024 at Sh11 and continues to trade around the same mark according to the entity’s manager.
ICEA Asset Management Limited says the Reit is now set for its growth phase following the restructure and is set to unveil a new growth strategy covering the unit’s immediate to medium-term vision by the end of 2024.
The firm applauds the stay of retail investors as a testament to the underlying Reit potential in the long term.
“For us, it’s a sign of the confidence we have in terms of expectations that there will be a transformation in the Reit,” added Mr. Kihanda.
ILAM Fahari Reit closed the six months to the end of June with an asset base of Sh2.9 billion including three properties- a shopping centre, an office building, and one semi-office/light industrial building, all held through special purpose vehicles.
ICEA Lion Asset Management raised its ownership in the Reit to 22.74 percent after buying out the bulk of retail/non-professional investors last year by acquiring 36.16 million shares or units.
Philip Ndegwa family-linked ICEA Lion Life Assurance Company meanwhile saw its shareholding in the Reit rise to 23.87 percent or 43.2 million shares/units at the end of the restructuring, indicating fresh purchases by the underwriter during the redemption programme.
Other top holders of the Reit include Stanlib Kenya Limited, Liberty Group Limited, and One Globe Holdings Limited.
The balance of shares/units is largely held in four nominee accounts under Standard Chartered and Stanbic banks.
