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CMA Working Towards Regulation and Registration of Real Estate Investment Trust (REIT)

Recently, the Capital Markets Authority in collaboration with key stakeholders proposed the creation of the Kenya National REIT.

In 2013, Kenya became the third African Country to incorporate REITs as an investment tool to regulate REITs in the category of; Income-REITs, Development-REITs and Islamic-REITs.

In an attempt to regulate and facilitate the registration of REITs, The Capital Markets Authority (CMA) together with Sanduku Investment Initiative, Association of Pension Trustees and Administrators of Kenya of Kenya has collaborated and created the Kenya National REIT (KNR). KNR is tasked with the mandate of ensuring the delivery of affordable housing in Kenya since it is linked with the Government’s Economic Transformation Agenda.

KNR has been envisaged as the accreditation body for REITs and its service providers. KNR will also act as the focal point for interaction with policy makers. According to CMA CEO, Mr Wyckliffe Shamiah, REITs was an area of interest by the National Government since REITs have the prospects of facilitating capital through capital markets in order to meet the ever growing demand of purpose built real estates.

The Chairperson of Sanduku Investment Initiative, Mr. Tom Mulwa, emphasizes that the only REITs that will be registered by KNR are those that are capable of enhancing the growth of the national economy, create employment and deliver affordable houses to Kenya. The goal of these is to encourage the national government to support domestic capital market.

Highlights

Once the relevant stakeholders have adopted the proposed amendment, the following will accrue:

  • REITs will be under one centralized body, KNH, which will link with other policy makers to regulate and ensure the registration of REITs.
  • This initiative by CMA is to bring into completion the fund raising efforts for the ongoing affordable housing scheme by the National and County Governments
  • Creation of more job opportunities will be achieve.

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