ILAM Fahari I-REIT profits for the half-year ending 30 June 2020 grew by 13 percent to KSh 86 million against a net profit of KSh 76.4 million recorded in a similar period last year. This translates to distributable earnings of 48 cents per unit compared to 42 cents in June 2019.
In the six months, the REIT was transferred from STANLIB Kenya limited and Cooperative Bank, to ICEA Lion Asset Management Limited (ILAM). Therefore, effective 18 May 2020 ILAM became the manager and promoter of the REIT.
Rental and related income increased marginally by 2% against the backdrop of Covid-19 pandemic where most businesses, especially in the retail sector, are experiencing financial difficulties. As a result, some tenants adversely affected by the pandemic were given rebates, which suppressed the growth in the rental and related income.
Interest income declined slightly by 1% compared to a similar period in 2019. This is due to the downward pressure on interest rates being experienced in the market as a result of the pandemic.
Property expenses reduced slightly by 1% compared to a similar period in the prior year due to measures taken by the REIT manager to control expenses and cushion the fund from the effects of the pandemic.
Fund operating expenses decreased by 13% mainly due to a saving in the expenses towards Annual General Meeting (AGM) as well as Investor Briefing activities, which have been deferred to August due to the pandemic.
As at 30 June 2020, total assets under management stood at Ksh 3.7 billion comprising investment property valued at Ksh 3.5 billion and cash reserves of Ksh 241 million.
ILAM Fahari I-REIT is a real estate investment trust, listed on the Nairobi Securities Exchange. It owns four properties (a shopping centre, an office building and two semi-office/ light industrial buildings) valued at Ksh3.5 billion, all held through special purpose vehicles.
A first and final distribution of 75 cents per unit was paid in May 2020 in respect of the 2019 financial year. The REIT Manager has not recommended an interim distribution for the period ended 30 June 2020.