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Tigere Property Fund has become Zimbabwe’s first real estate investment trust (REIT) to list on the Zimbabwe Stock Exchange (ZSE). Finance Minister Professor Mthuli Ncube, rang the ceremonial opening bell to signify the listing of the Trust at an event on November 30th. The Trust started trading on the bourse on December 1st.
The listing follows a successful initial public offering which was 95,42 percent subscribed.
REITS are an investment vehicle regulated under the Collective Investment Scheme Act following the issuance of SI 240 of 2019.
Speaking at the listing event, Professor Mthuli Ncube stated that globally, REITS have been a key driver of sustainable real estate projects across the globe, accounting for almost US$7 trillion worth of assets.
“In Zimbabwe, they are expected to encourage the growth of the property sector by providing funding for new and exciting infrastructure development projects. Through my ministry, we have done our best to make sure that REITs are attractive instruments to the investing public by providing tax exemptions through the Finance Act (No. 2) of 2020,” Professor Ncube said.
The Finance Minister also declared that the suggested REIT sector limitations announced in the Budget Speech would not be implemented “as the limitations would be counterproductive to infrastructure development” The Ministry of Finance remains committed to providing investors within the private sector the tools and policies to unlock value for the continued economic development of the nation.
Anymore Taruvinga, CEO of the Securities Exchange Commission, welcomed the launch of REITS, which will offer benefits to individual investors, including affordability and stability.
“Since a REIT is a unified asset, investors can get into the commercial property at a fraction of what they would have paid had they done so directly. “Moreover, REITs provide a stable income stream as they tend to pay out regular dividends derived from rental income,” he said.
To qualify for tax exemption, REITS in Zimbabwe, are required to pay out 80 percent of gross annual income as dividends.
The Tigere REIT currently comprises two commercial real estate assets, namely Highland Park Shopping Mall and Chinamano Corner. Both properties have been developed by Terrace Africa, which says it has a number of others at various stages of development that will be added to the Tigere Portfolio.
“Unitholders in the Tigere REIT will also have access to our extensive and innovative property development pipeline, which comprises a luxury hotel, state-of-the-art conference centre, and integrated office park as well as a shopping mall at the Harare Exhibition park,” explained Brett Abrahamse, MD of Terrace Africa Asset Management, the Tigere Fund Manager.
He added that thanks to the conducive environment created by the government to facilitate investments, Terrace Africa, has enjoyed positive engagement with several international investors who have expressed willingness to invest up to U$100 million into various real estate projects, which are under development.
About Terrace Africa:
Terrace Africa is a property development and asset management company operating within the African real estate industry since 2011. The company has delivered over USD 150 million worth of projects with a focus on convenience retail. They currently have active projects in Zimbabwe, Zambia, Mozambique, and South Africa. Terrace Africa offices are located in both Harare and Johannesburg.