Fidelity investment gets US$60m prescribed asset status

LISTED insurance firm, Fidelity Life Assurance Group, says its recently launched Eagle Real Estate Investment Trust (REIT) has been granted prescribed asset status of US$60 million.

This development, according to the group, provides a profitable avenue for it to deploy investments that support regulatory compliance.

Prescribed assets generally means that a certain percentage of the assets of retirement funds must be allocated to certain Government-approved instruments such as bonds or securities issued by the Treasury, councils, quasi-Government organisations or any other bond.

Under prescribed assets, Government requires such investors as retirement funds to hold a certain number of investments in Government-specified assets in the form of State-owned entities’ bonds.

Last month Fidelity Life launched a REIT fund to raise about US$60 million to be invested in the development of medical, hospitality and residential facilities in Victoria Falls and Mazowe among other areas.

In a statement accompanying the group’s trading update for the first quarter ended March 31, 2024, company secretary, Ms Ruvimbo Chidora, said the asset management funds grew by 12 percent compared to the same period last year.

She said the Eagle REIT fund made significant progress on the Mazowe Mall project and pre-project works in Victoria Falls.

“The fund was also granted Prescribed Asset Status of US$60 million, providing a profitable avenue for the group to deploy investments that support regulatory compliance,” she said.

“As key components of our ‘cradle to grave’ model, these business units remain vital to our group’s strategic growth and development.”

Cradle-to-grave is a model used in the scientific footprint method Life Cycle Assessments (LCA). It assesses the complete environmental footprint of products from raw material extraction, production and product use until the end of its life.

According to Fidelity the Eagle REIT will develop a 32-bed hospital, a 120 key hotel and 154 apartments residential townhouses on about 12,3 hectares of land in Victoria Falls.

In Mazowe, the fund will see the construction of a retail complex to house a medical facility as well as residential space while in Mutare, Fidelity is converting an already existing building into a hotel, which will have about 120 to 130 rooms.

To promote sustainable landing, Ms Chidora said five percent of loan disbursements during the quarter under review were allocated to clean energy-related products.

She said the micro-lending business recorded a significant increase in interest income, with a growth rate of 107 percent driven by an expansion in new business.

“The company entered into partnership agreements with key strategic partners, paving the way for growth in new markets.

“Approximately five percent of loan disbursements were allocated to clean energy-related products, demonstrating a commitment to sustainable lending practices,” said Ms Chidora.

“The non-performing loans ratio remained at seven percent outperforming the sector’s average of 10 percent.”

Ms Chidora said non-insurance businesses, that is the actuarial consulting services and asset management, achieved an impressive revenue growth of 125 percent.

This growth was driven by expansion in new business pipelines, thereby complementing the existing streams. —chronicle