An income-REIT is a real estate investment scheme which owns and manages income generating real estate for the benefit of its investors. Distributions to investors are underpinned by commercial leases. This means that income returns are predictable and generally less volatile. The I-REIT provides an instrument for investing in the real estate market which offers both liquidity and a stable income stream.
The STANLIB Fahari I-REIT is Kenya’s first Real Estate Investment Trust (REIT). The Fund aims to provide investors with a steady stream of income and capital growth by investing at least 75% of its Total Asset Value (“TAV”) in real estate in strategic locations within Kenya with a maximum of 25% invested in cash investments or cash-like instruments.
The STANLIB Fahari I-REIT is a closed-ended fund and its units are listed on the Nairobi Securities Exchange under the main markets segment under the Real Estate Investment Trust section code FAHR. Once the initial public offer was concluded in November 2015, units of the STANLIB Fahari I-REIT could only be traded through the NSE. Consequently, the market price of the Units is market driven and may not necessarily be equal to the Net Asset Value of the STANLIB Fahari I-REIT. However, the I-REIT Scheme may undertake secondary offers as and when the need arises.
The STANLIB Fahari I-REIT aims to provide consistent income and capital growth in the long-term. Our active management approach targets quality physical properties within carefully chosen economically growing nodes.
Property is not correlated with other asset classes. Investing in property may improve a portfolio’s risk return proﬁle.
The income earned by the I-REIT enjoys exemption from income tax, under section 20 of the Kenyan Income Tax Act. As a result of this exemption, all income generated and distributed by the I-REIT is taxable in the hands of the unitholders, to the extent that those unitholders are not exempt from tax.
Transparent investment vehicle
Investors are able to understand exactly what you’re invested in, from the actual assets, costs and returns.
An I-REIT can more easily be bought or sold. Investors do not have to deal with the complexity of selling a physical property.
The STANLIB Fahari I-REIT is listed on the Kenyan NSE therefore creating a secondary market for I-REIT shares.
The STANLIB Fahari I-REIT will beneﬁt from underlying properties’ capital gains and rental income giving investors exposure to a consistent stable return proﬁle in the long-term.
The STANLIB Fahari I-REIT has been approved and will be monitored by the Kenyan Capital Markets Authority (CMA).
Of the Direct Property allocation, the I-REIT will invest as per the permitted sectors including: