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First Kenyan Real Estate Investment Trust posts Sh108M profit

Stanlib Fahari I-REIT CEO Kenneth Masika (Left) has said the results are notwithstanding the low levels of awareness on REITs

NAIROBI, Kenya, Mar 24 – Stanlib Fahari I-REIT has recorded Sh108 million in net profit for the year ended 2016, with management crediting efficient management of its three properties to the results.

“The profits are despite a difficult working environment,” Stanlib Fahari I-REIT CEO Kenneth Masika said adding that the results are notwithstanding the low levels of awareness on what REITs are.

Its net asset value closed the year at Sh19.81 per unit, with the company intending to distribute Sh90 million in dividends at Sh0.50 per unit.

“The REIT manager has recommended and the REIT trustee has approved a total distribution of Sh90.5 million which translates to approximately 92 percent of the distributable earnings. This compares favorably to a statutory minimum distribution of 80 percent as per the REITs regulations,” Masika said.

Its total revenues stood at Sh248.5 million, while its operating costs were Sh180 million.

“Our operating costs of both the property and the fund would include audit and trustee fees, license fees, maintaining tenants, properties, in filling vacancies, marketing and public relations among others.”

The management has revealed plans of raising more funds, saying it will help them benefit from economies of scale.

“We currently own Greenspan Mall, Bay Holdings and Signature International properties at a consolidated cost of Sh2.4 billion. We are in discussions with a couple of landlords to acquire more diversified properties in different locations,” said Masika, a move that will help the company raise more funds.

Going forward, the company intends to engage in investment awareness campaigns, engaging with the Nairobi Securities Exchange and acquiring additional properties among others.

It also expects to make more profits going forward. According to Masika, there are investors who were on the lookout for the company’s first-year performance and will possibly get on board following the results.

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