Individuals who bought into Cytonn High Yielding solutions, invested in real estate projects, will have to wait longer before they can recoup their investments.
This is after Cytonn Investments Management Plc, in a brief to its clients, said it has extended the maturity date of this fund by 90 days.
“Reduced construction activity, closure of lands offices and slowed purchase of real estate units” are the reasons cited by Cytonn Investments, “for extending maturities for this fund 90 days- a period within which it expects its construction sites to reopen,” according to a statement by Mr Edwin H. Dande, CEO Cytonn Investments Management Plc.
This decision has now elicited sharp reactions from investors who have taken to social media platforms, to vent their anger and frustration. Investors have complained about delayed payouts by Cytonn, with individuals accusing the firm of playing games with them.
“Please explain to me why I cannot receive my funds that are already matured in the Cytonn HYS account,” said Ann on twitter. Peter Kimani, yet another Cytonn client, expresses his pain and accuses the firm of rolling on his funds forward without seeking his consent.
Cytonn High Yielding Funds invests in real estate, and promises a return of 18 per cent per annum.
“Kindly note that a restructuring of real estate funds in this COVID-19 environment is not unique to Cytonn.” Says the firm’s CEO in a statement dated April 10th, 2020. He said that with COVID-19, it would be strange for the fund not to feel the impact of the prevailing challenging environment.
The firm told its clients that the board of investors voted to reinvest these funds under the 90-day extension, a period within which the firm expects the real estate sites to reopen, given the prevailing COVID situation.
Cytonn mentions that this extension of maturities resolution is in line with Clause 21 of the investment agreement, which exists precisely for these kinds of scenarios and times; and the resolution was communicated to all investors.
Given the ongoing COVID-19 environment, Cytonn said it has either closed or drastically reduced labour in all its sites for the next 90-days. Its contractors and sub-contractors are not available to work during this COVID-19 period.