Tigere REIT gives investors new option
The Tigere REIT has two properties, namely Highland Park Mall, which opened its first phase in June this year and has 27 retail shops on a lettable area of over 6 000 square metres.
ASSET management firm, Terrace Africa, has launched its Real Estate Investment Trust
(REIT), Tigere, in Harare on Friday, as the company prepares to list the real estate
property-based investment security on the Zimbabwe Stock Exchange (ZSE).
The REIT, to be listed on the ZSE next month, will be the first such security on the
market. Tigere REIT will be managed by Tigere Property Fund.
Terrace Africa’s has been on an aggressive expansion of retail properties with two
properties completed this year while another is currently under construction. The
company is preparing to start construction on another property in January 2023.
REITs allow a company to pool investor funds into real estate investments. Investors buy
units in the trust and share profits from the investments. The government introduced a
law to allow REITs in 2019, and added tax breaks for issuers the following year, hoping to
add depth to the capital markets.
Terrace Africa managing director Brett Abrahamse said, “A total of 255,3 million units in
the Tigere REIT will be on offer at $28 per unit and at the end of the offer, we hope to
have issued all the 719,323,000 units available.
The Tigere REIT has two properties, namely Highland Park Mall, which opened its first
phase in June this year and has 27 retail shops on a lettable area of over 6 000 square
metres. It is anchored by tenants that include Pick n Pay, Puma Energy and Simbisa
Brands.
Another Terrace Africa property that is part of the REIT, is the US$3,7 million Chinamano
Corner, which has 13 shops and offices plus a Simbisa fast-food outlet.
According to Tigere Property Fund, about 75 percent of income earned from tenants by
the Tigere REIT is US dollar-linked and occupancies are currently reported at 95 percent.
“As Zimbabwe grows, we as a company are positioning ourselves to be at the forefront of
retail development,” Mr Abrahamse added.
Insurance and pension funds regulator, Insurance and Pensions Commission (IPEC), says
REITs may help solve one puzzle that Zimbabwean pension funds face, which is valuation
of property investments.
“We think the valuation dilemma is largely due to the absence of a secondary trading
market for properties, particularly the unlisted property holdings. Therefore, we are
convinced that REITs will go a long way in bringing transparency in the valuation of
investment property,” IPEC chairperson Grace Muradzikwa said earlier.
“Unit holders will also have access to our extensive and innovative US$50 million
property development pipeline, which comprises exciting commercial projects that are
currently in the planning or development stage,” Mr Abrahamse says. Terrace Africa,
which is also the developer of Village Walk in Borrowdale and the Marondera Mall, says it
has a pipeline of at least 15 more developments. These include malls at the Zimbabwe
Agricultural Showgrounds, Ruwa, and Chitungwiza. Beyond Zimbabwe, the company has
developed and runs retail projects in Mozambique, Zambia and South Africa.-The Herald
