Investors at the Nairobi Securities Exchange (NSE) are showing high appetite for Real Estate Investment Trust (REIT), with turnover recording an upward trend.
REIT is an investment tool that allows investors to pool capital, which is then invested in a portfolio of selected properties for a return.
Investors gain through capital appreciation and rental income, with the latter being distributed to unit-holders annually.
The investment option was introduced at the Nairobi bourse in October 2015, and was listed at the Real Estate Trust Market Segment. Like any other listed security, its value is determined by market dynamics.
Since its launch, REIT had experienced lacklustre trading and is not gaining traction among investors seeking returns away from bonds and equities.
REITS turnover at the bourse on Tuesday stood at 9.3 million U.S. dollars, which was more than 100 percent rise from the previous session.
On Monday, the segment recorded a turnover of 4.3 million dollars, which was a slight decline from the previous day’s 5.8 million dollars. On Friday last week, turnover at the segment stood at 4.2 million dollars.
Central Bank of Kenya noted that last week REIT turnover rose 246 percent following high investor appetite.
“Turnover in the real estate market segment REIT increased by 246.3 percent, with the number of deals growing by 55.88 percent over the week signaling continued high investor appetite for asset-backed securities,” said the apex bank in a brief Wednesday.