ILAM Fahari Real Estate Investment Trust (REIT) has been admitted to the Unquoted Securities Platform (USP) of the Nairobi Securities Exchange (NSE). This is following a comprehensive restructuring of the REIT.
Earlier in February this year, ILAM received regulatory approval from the Capital Markets Authority (CMA) to delist the REIT from the Main Investment Market Segment (MIMS) of the NSE. This restructuring process involved converting from an unrestricted to a restricted I-REIT.
Delisting from MIMS and trading over the counter on the USP will provide greater flexibility in managing the REIT’s portfolio. The move will also not affect the unitholders’ ability to trade their units, with Non-Professional investors (investors whose unit value are less than Ksh 5 million) bundled into a Nominee Account.
The decision to convert and restructure stems from the ILAM Fahari I-REIT’s comprehensive strategic review in 2021, which sought to understand the challenges the I-REIT faced and develop potential strategies to improve the returns and market performance. The long-term plan will elevate returns and market performance through asset optimization and the growth of Assets Under Management (AUM).
Speaking during the bell-ringing event to commemorate the REIT’s admission to the USP, ILAM CEO Einstein Kihanda expressed confidence in the REIT’s ability to thrive. He noted, “We are upbeat about the potential of the REIT following its listing at the USP. This move provides us with increased flexibility and potential for growth. The new structure aligns with ILAM Fahari’s strategic vision to optimize its investments and provide investors with innovative avenues to diversify their portfolio.”
Upon successful implementation of the strategy, the REIT will consider relisting on the NSE after 3 years. Under this new segment, ILAM Fahari I-REIT will remain regulated by the Capital Markets Authority.
Present at the bell-ringing event was NSE CEO Frank Mwiti who noted, “The admission of the ILAM Fahari I-REIT is a testament of the commitment by the leadership of the REIT to put the needs of their unit holders at the core of their operations and a demonstration of their dedication to ensuring unit holders enjoy maximum value from their investment in the form of capital protection, appreciation and dividends. The admission is also a strategic move aimed at ensuring that the REIT is well positioned to take advantage of future growth opportunities.”
The restructuring is expected to create several benefits for unitholders, including increased flexibility to pursue a broader range of investment opportunities. This includes direct real estate acquisitions and developments, improved ability to align the REIT’s investment strategy with the long-term needs of its unitholders, and reduced costs and administrative burdens associated with being a listed REIT.