Centum Investment Company expects to issue a dollar denominated income Real Estate Investment Trust (I-Reit) at its Two Rivers special economic zone in Nairobi in January 2026, handing the Kenyan market its first foreign currency denominated Reit.
The company is eyeing a Sh4.78 billion ($37 million) from the proposed I-Reit, which is pending regulatory approval, with the proceeds earmarked for construction of green commercial property in the Two Rivers International Finance and Innovation Centre (Trific).
Centum, which had stated its intention to float the dollar Reit at the beginning of this year, will be paying investors a dollar return of about 8 percent.
The company is planning to issue long-term, dollar-based leases with guaranteed annual escalations on the property to be developed using the proceeds of the Reit, in order to achieve a currency match between the investment and returns.
“The initial I-Reit proceeds will be used to acquire the Trific North Tower, with future raises financing additional green, dollar-rent-generating commercial assets within the special economic zone,” said Brenda Mbathi, the chief executive officer of Trific.
“These long-term, dollar-based leases with guaranteed annual escalations, combined with TRIFIC’s embedded service-support model, create a reliable and growing income stream for investors.”
The Trific North Tower currently has about 16,234 square metres of lettable area, with centum saying that it is currently 90 percent leased to international services firms.
Trific, which was given the SEZ licence in June 2023, sits on 64 acres or more than half of the two Rivers development’s total area of 106 acres, and has grade-A offices, residential, hospitality and social amenities.
Centum mainly targets global service exporters including Business Process Outsourcing (BPO) firms, tech firms, shared services centres, and professional services companies for its Two Rivers special economic zone.
The company is also planning a second office tower within the SEZ with lettable space of 76,400 square metres, although it has yet to disclose whether the new property will eventually be sold into the I-Reit.
In June 2024, Trific bagged funding worth $47.5 million (Sh6.14 billion) from Africa-focused fund manager Vintage Capital to finance the construction of the new tower, as well as furnishing the existing one.
Through its proposed Reit issuance, Centum will join ICEA Lion, Laptrust and student housing developer Acorn Holdings as Kenya’s Reit issuers, just over a decade since the Capital Markets Authority (CMA) introduced the product in the Kenyan market.
Income Reits are structured to purchase and hold property for rental income. They are mandated by the law to distribute to unit holders at least 80 percent of their net profits as dividend, which is exempt from taxes.
In Kenya, the existing Reits are exclusively marketed to a class of buyers known as professional investors, who are high net worth individuals or institutions whose minimum investment in the Reit is Sh5 million.
By issuing the I-Reit in dollars, Centum is targeting external investors who may have been wary of a shilling denominated Reit on fears of exchange losses when converting the income distribution.
