Tigere Real Estate Investment Trust (REIT) has been listed on the Zimbabwe Stock Exchange (ZSE) through an Initial Public Offer ahead of maiden trading on the bourse tomorrow.
A REIT is a company that own or finance income-producing real estate across a range of property sectors. These real estate companies have to meet a number of requirements to qualify as REITs. Most REITs trade on major stock exchanges, and they offer a number of benefits to investors.
Tigere REIT is affiliated to Terrace Africa Asset Management.
The Tigere REIT offer was announced on October 28, 2022 and closed on November 25, 2022 after receiving 243 647 792 subscriptions out of 255 323 000 units on offer which is about 95, 427 percent subscription rate..
Speaking at the listing today, Finance and Economic Development Minister, Prof. Mthuli Ncube said the Tigere REIT listing is a landmark development in the country’s capital markets.
“Property will always be a key contributor to the economy within Zimbabwe and the REIT legislation will further encourage growth within the sector. This will bring new and exciting infrastructure into our cities and towns,” said the Minister.
“Liquidity within real estate markets which the REIT provides, will be critical to the pension fund sector within Zimbabwe. IPEC has also played a pivotal role in promoting REITs by allowing REITs to be included in Pension Funds Prescribed Assets.”
World over, Real Estate Investment Trusts are registered in over 40 countries and account for almost US$ 7 trillion worth of assets.
REITs in Zimbabwe are tightly regulated through the Collective Investment Scheme Act following the issuance of SI 172 of 1998.
Through Securities and Exchange Commission of Zimbabwe (SECZ) chief executive officer Anymore Taruvinga said the Commission registered the Tigere REIT in July this year.
“The total number of Collective Investment Schemes now stands at 67 with funds under management of $55.6 billion. At the end of Q3 2022 the number of unit holders in these funds stood at 80276. The Tigere REIT is one of the 5 schemes and in the pipeline, we have two more REITs.”
REITs are more liquid compared to physical properties and units of listed REITs are readily converted to cash as they will be traded on exchanges.
They also give exposure to large-scale real estate. One also benefits from having the REIT and its underlying assets managed by professionals who will add value leading to higher investment yield.
Tigere REIT has been reported to have a net asset value of US$22,2 million and will pay quarterly dividends in foreign currency.
Currently, the assets include Highland Park as well as Chinamano Corner and expects to at least double the number of properties in the next two years.
Tigere REIT is majority owned by Frontier Real Estate Development which has in the past raised capital for property assets worth US$120 million.
