Laptrust to weigh bids for property fund shares


Nairobi Securities Exchange (NSE) chairman Kiprono Kittony at the Nairobi Securities Exchange grounds on Wednesday, March 22, 2023, during the bell ringing ceremony, to officiate the listing of Laptrust Imara I-Reit. PHOTO | DENNIS ONSONGO | NMG

Investors interested in buying into property fund Laptrust Imara I-Reit will have to negotiate a price acceptable to pension scheme Laptrust which currently owns nearly all the units (shares) in the newly listed entity.

The unique arrangement, a departure from the norm where shares trade transparently and freely after original shareholders sell a part of their stakes, has been approved by regulators and will remain in place for three years.

Laptrust Imara made an opening trade of 250,000 units at Sh20 apiece on Wednesday, valuing the transaction at Sh5 million which meets the minimum investment size for the real estate trust. An unnamed pension fund bought the units.

“Customers will approach us and we will agree on price and then they buy until the market is more understanding of this product and that’s why we are taking our time,” Laptrust CEO Hosea Kili told the Business Daily.

The pension fund is expected to open up the Reit as a regularized mainstream listing after a three-year window allowing the commencement of normal automated trading.

Even so, participants in the trading of Imara I-Reits will be limited to persons qualifying as professional investors, restricting participation to high-net-worth individuals and institutions such as pension firms and insurers.

NSE-listed Ilam Fahari I-Reit which trades like an ordinary stock is the only property fund to embrace retail/small investors having set a minimum investment amount of Sh20,000 when it listed in November 2015.

Investors can now invest as low as Sh650 to buy 100 units of Ilam Fahari in the open market.

NSE’s chief executive Geoffrey Odundo says the bourse will be accommodative to differently structured funds with the view of growing the Reit’s space.

“We expect to see more Reits coming through but we are yet to register any applications. Structures will come in any form but we want to make it as flexible as possible for the listings to come as we want to have a critical mass of Reits,” he said.

The Laptrust Imara I-Reit has 346,231,413 units with the Sh20 per unit price being based on the net asset value of the scheme at the time of listing.

Properties held under the fund include CPF MetroPark, CPF House, Pension Towers and Freedom Heights Mall.

The Reit is the first to be listed by a pension fund on the Nairobi Securities Exchange.

The investment vehicle closely resembles the Acorn Student Accommodation I-Reit by the profile of the investor and the minimum capital required.

While the Acorn property fund is not listed on the NSE, the investment vehicle trades on the over-the-counter market in transactions with a minimum of Sh5 million per trade.

Laptrust is the first pension fund to list a Reit and it is expected to be followed at the NSE with more fund managers expected to replicate the move.

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