Acorn Investment Management Ltd (AIML), the entity behind Qwetu and Qejani Student Residences, has posted a Ksh.1.16 billion net profit for its Real Estate Investments Trusts (REITS) for the full year ended December 31, 2021, falling in their first year of operation.
The Acorn Student Accommodation Development REIT (ASA D-REIT) recorded a Ksh.776 million net profit while the Acorn Student Accommodation Income REIT (ASA I-REIT) recorded Ksh.387 million net profit for the period under review.
“A large share of the credit in this milestone will go to the launch investors who believed in us and became part of the journey. The significant progress made has seen a growth in the ASA D-REIT Net Asset Value (“NAV”) from KES 4.21 billion at launch in February 2021 to KES 5.23 billion as at December 31, 2021, denoting a 24.4% increase in NAV with the value per unit appreciating from KES 20 per unit at launch to KES 23.84 per unit at the end of 2021.” said Acorn Holdings Ltd. CEO Edward Kirathe
The ASA D-REIT now has 6,267 beds in the portfolio comprising 3,509 Qwetu beds and 2,758 Qejani beds.
On the back of the strong performance, the ASA I-REIT has grown its NAV from Ksh.3.3 billion at launch in February 2021 to Ksh.3.5 billion as of December 31, 2021, a 4 percent increase in NAV with the value per unit ex-dsitribution appreciating from Ksh.20 per unit at launch to Ksh.20.80 per unit at the end of 2021.
The ASA I-REIT has 1,773 Qwetu beds under its portfolio and expects to acquire new properties from the ASA D-REIT in 2022.
“The first annual results of the ASA REITs mark a milestone for these investment vehices. Despite the economic challenges faced during 2021, the positive financial performance of both REITs underlines the fundamental demand gap that exists in the Purpose-Built Student Accommodation (PBSA) asset class,” said Managing Director of AIML, Mr. Raghav Gandhi.
The record profit has seen the REIT Manager and Trustee approve the payment of a final dividend of Ksh.106 million equating to KES 0.64 per unit.
This, together with the interim dividend of KES 63 million declared in July 2021 (KES 0.38 per unit), has resulted in a full-year dividend of Ksh.169 million or Ksh.1.02 per unit.
The dividend yield equates to 5.4% and represents a payout ratio of 93%, which is 13% more than the regulatory requirement of 80%.
ASA REITs manager has received approval from the Capital Markets Authority (CMA) for additional primary issuance of up to Ksh.3.2 billion from April 2022.
This, according to the manager, will be made available for subscription to existing and new investors.
