Cytonn Investment is set to launch its asset management arm in Nairobi on Monday, following approval by the Capital Markets Authority (CMA) as a licensed Real Estate Investment Trust manager.
The move will see it increase its asset management portfolio, which stands at Sh21 billion, when it officially launches Cytonn Asset Managers.
The new company is eyeing Sh1.2 trillion assets held by retirement benefit schemes to drive its business to the next level.
“In addition to traditional investments and high-yielding products such as bond funds, equities and real estate that have returned about 18 per cent per annum to our clients, we feel this is one of our compelling offerings and creating development opportunities in the fluid money market,” said Edwin Dande, Cytonn’s chief executive.
The company, which is celebrating its fifth anniversary since it was founded, hopes to ride on its diversified real estate portfolio and high-yielding investment solutions to deliver robust performance in the asset management segment.
“Being a real estate and private equity firm, our strategy is to focus on this attractive investment segment and develop it by spearheading the digitisation of the money market fund where clients would be able to access their money right on their digital devices,” said Mr Dande.
He said due to a widening gap in the fund managers’ knowledge and expertise in packaging and offering alternative investments, many clients were faced with superior risks adjustment returns than traditional investments.
“We seek to use our expertise to offer this to a wider pool of investors, who may not have been able to access these investments previously as they could only be accessed through private market offers,” said Mr Dande.
He added plans were at an advanced stage to digitise the unit trust funds processes before the end of the year.
“We want to make use of our high-end expertise in offering alternative investments to give our clients value for money, including pensions, as we want to offer them highly de-risked real estate investments in well researched areas,” said Mr Dande.
According to experts, lack of well-grounded asset managers in the fluid money markets has led to poor performance.
“This has dampened the growth of the property market as pension schemes were not getting value for their money as their returns were oscillating between five and nine per cent annually,” said Cytonn head of Unit Trusts Victor Odendo.
Mr Odendo said there are many advantages of having a qualified asset manager as they help clients come up with investment plans that suit their specific investments needs.
“A qualified asset manager is regulated by the relevant authorities, ensuring extra oversight on clients investments, and the firm,” said Mr Odendo.
Cytonn says in a bid to penetrate the market at the counties, it plans to spread its wings to major commercial centres in the country including Mombasa, Kisumu, Eldoret, Nyeri, Meru and Nakuru.