African markets

Zimbabwe Stock Exchange announces first REIT in November

Tigere Property Fund is set to become Zimbabwe’s first listed Real Estate Investment Trust (REIT) after publishing its prospectus and announcing public listing dates last week on Friday, October 28.

It comes after the Securities and Exchange Commission approved Tigere REIT in July this year.

The REIT is duly licensed by the Securities and Exchange Commission of Zimbabwe under the Collective Investment Schemes Act (Chapter 24:19). In a letter dated October 21, 2022, the Listings Committee of the Zimbabwe Stock Exchange (ZSE) approved the listing of Tigere REIT on the ZSE.

  • Tigere Real Estate Investment Trust is expected to list on the ZSE in November, a development that is expected to build a strong real estate sector and drive economic growth through infrastructure development.
  • The Tigere REIT will be listed under the symbol TIGZ. According to the firm’s prospectus released on Friday, the IPO is scheduled for November 23, 2022.

The promoter (Frontier Real Estate) intends to sell a total of 255,323,000 REIT shares in Tigere Property Fund at an offering price of ZWL 28.00 per share through a public share offering investor. Following the Initial Public Offering (IPO), it is expected that all 719,323,000 Units issued will be listed on the ZSE.

According to the published prospectus, the total estimated initial expenses associated with listing Tigere REIT on the ZSE are expected to be approximately $770,902, which includes professional fees as well as regulatory, advertising, printing and postage. The costs also include stamp duty associated with transfers of ownership in the REIT.

Following regulatory approval in 2021, Tigere’s listing will be a milestone for the Ministry of Finance, the Zimbabwe Stock Exchange (ZSE) and the broader investment community as it provides more options for investors.

“We are delighted to announce the listing of Tigere REIT, which is an important step in developing and strengthening capital markets, as well as building a strong real estate sector in Zimbabwe. Our seed assets are already performing exceptionally well, with revenue and occupancy levels above initial expectations. commented Brett Abrahamse of Terrace Africa Asset Management.

The Tigere REIT will be listed on the Zimbabwe Stock Exchange under the ticker symbol TIGZ and will offer investors the opportunity to hold an equity stake in high quality commercial property through a highly regulated financial structure.

Commenting on the new development, ZSE CEO Justin Bgoni said: “The listing of the Tigere Property Fund is an exciting time in the history of Zimbabwe’s property sector and the economy at large. It is the culmination of years of work and policies led by the Minister of Finance and Economic Development, Mthuli Ncube, to develop and deepen capital markets, which led to the formation of FPIs in Zimbabwe .

“As the ZSE, we are indebted to the support of the ministry and believe this listing is a symbol of progress and that Zimbabwe is open for business. We look forward to seeing more REIT listings in the near future and congratulate the Tigere team on their success in creating more value for investors and facilitating economic growth in the country.

  • The REIT is duly licensed by the Securities and Exchange Commission of Zimbabwe under the Collective Investment Schemes Act (Chapter 24:19).
  • According to the prospectus, the REIT was seeded with newly completed commercial real estate assets in accordance with the Fiscal Act (No. 2) of 2020 qualifying requirement for REIT tax-exempt status. The two properties that will be seeded into the Fund are Highland Park (Phase 1) and Chinamano Corner, both located in Harare.

By listing, the REIT aims to attract targeted and permanent capital for the developer to develop other assets, to support the Insurance and Pensions Commission and the Ministry of Finance and Economic Development in their efforts to provide liquidity and deepen savings pool through REIT products and also to provide retail and institutional investors with a liquid, quality commercial real estate investment vehicle.

Based on published prospectors, the company said a nation’s economic growth is driven by a vibrant business infrastructure of both industrial and retail properties to support production and trade.

The development of quality commercial properties is more than imperative in this Southern African country as the economy is on the way to a recovery which is expected to revitalize significant economic activity.

“Involving local beneficiaries in the development and ownership of these assets promotes inclusive capital growth and sources of passive income for average Zimbabweans. This makes a strong case for a well-structured REIT that allows investor participation with a minimum capital requirement, providing value preservation and a stable return of capital through income distributions and capital gains. .

“The Tigere REIT will provide a unique opportunity for investors by giving them exposure to high quality commercial real estate assets in strategic locations with growing demand across Zimbabwe. The Fund will aim to achieve a minimum income yield, which will be supported by a diversified mix of quality tenants and active asset management,” the prospectus reads.

According to the prospectus, the REIT was seeded with newly completed commercial real estate assets in accordance with the Fiscal Act (No. 2) of 2020 qualifying requirement for REIT tax-exempt status. The two properties that will be seeded into the Fund are Highland Park (Phase 1) and Chinamano Corner, both located in Harare.

According to Abrahamse, the Tigere REIT was seeded with two new retail business assets, which together have a combined total of 41 retail tenants.

Highland Park – “The property is located in Highlands with its official address being 1 Arcturus Road, Highlands, Harare with Highlands consolidated stand number 1006. The development, with a gross leasable area of ​​approximately 6,704 square meters with 221 parking spaces , comprises 27 Retail tenants, including a gas station.

Chinamano Corner – “The property is located on the corner of J. Chinamano Avenue and Sam Nujoma leading directly to Harare CBD, its official address being 23 J. Chinamano Avenue. The tenant mix consists of 13 stores including a pharmacy, a convenience store, a florist and several food tenants. A Puma gas station acts as a key attraction on the site, allowing a steady flow of customers throughout the day,” the prospectus reads.