Property developer Acorn Holdings has reported a 32.2 percent growth in combined net profit to Sh456.63 million on its two Real Estate Investment Trusts (Reits) in the half year to June, riding on higher valuation and rental income from its student hostels.
Acorn’s financial report shows that its investment Reit (I-Reit) returned a net profit of Sh251.63 million, representing a growth of 53 percent compared to the first half of 2024, while the development Reit (D-Reit) profit grew by 13 percent to Sh205 million.
The Acorn I-Reit is now set to distribute a dividend of Sh95.78 million to its unit holders, at a rate of Sh0.29 per unit.
The I-Reit has 330.29 million units in issue, while the D-Reit has 226.25 million units, both trading on the Nairobi Securities Exchange (NSE) unquoted securities platform.
“Based on the 2025 half-year results, the Reits remain on course to deliver improved returns in 2025 driven by debt optimisation, keeping projects on plan and increasing occupancy across the portfolio,” said Mathew Maina, the executive director for Acorn Investment Management Limited, a wholly owned subsidiary of Acorn Holdings and which manages the Reits.
The Acorn D-Reit puts up student hostels near various universities using borrowed funds, and uses the proceeds of their sale to settle the obligations.
The I-Reit meanwhile absorbs the hostels —which are held under the Qwetu and Qejani brands— from the development arm once they are completed, thereafter generating income from rent and utilities that are then distributed as dividends to Reit holders.
Acorn said the D-Reit saw an increase in fair value gains on investments by 78 percent to Sh634.6 million, coming from three completed properties –Qejani at Hurlingham, Qwetu and Qejani at Kenyatta University and Qejani in Juja.
The D-Reit has also started construction of a 2,100-bed hostel in Eldoret’s central business district, and is acquiring land in Kakamega to put up a new hostel targeting students from Masinde Muliro University of Science and Technology.
“Both acquisitions mark the Reit’s strategic expansion into tier two university towns in Kenya, further deepening its footprint nationally,” said Acorn in a statement accompanying its financial report.
In Nairobi, the Reit is putting up hostels in the central business district under the Qwetu and Qejani brands, targeting students from the University of Nairobi and Technical University of Kenya (TUK).
Last year, the D-Reit concluded the redemption of its Sh5.7 billion corporate bond. The five-year medium term note, which was issued in November 2019, financed the construction of hostels in Chiromo, Hurlingham, Karen, Thika Road (USIU) and Madaraka.
The company usually utilises the proceeds of hostel disposals to its I-Reit to repay any debt incurred during the construction of the housing units. Acorn normally funds projects with a mix of about 65 percent debt and 35 percent equity.
On the I-Reit, the company said it has managed to cut total debt from Sh2.5 billion to Sh1.9 billion, and the effective weighted interest rate on the debt from 17 percent at the end of 2024 to 11.1 percent as at July 2025.
