Acorn Holdings, a leading property developer headquartered in Nairobi and founded by Kenyan real estate magnate Edward Kirathe, has announced plans to distribute dividends totaling Ksh482.8 million ($3.64 million) to unit holders of its two real estate investment trusts (Reits).
The company’s decision to reward its unit holders comes after declaring its first distribution from its development Reits, marking a significant increase from the initial projection. Despite a decline in net profit to Ksh71.6 million ($540,000) from Ksh384.2 million ($2.9 million) in 2022, primarily due to lower fair value gains on investment properties, Acorn Holdings remains committed to delivering returns to its investors.
Acorn’s 2023 financial report: Net profit dips amid market challenges
Acorn’s financial report for 2023 reveals a decrease in net profit to Ksh71.6 million ($540,000) from Ksh384.2 million ($2.9 million) in 2022. The decline is primarily attributed to lower fair value gains on investment properties.
Despite this setback, the company’s Reits have seen an upward trajectory in dividends, with the Acorn Investment Reit (I-Reit) increasing its total distribution for the year to Ksh242.8 million ($1.83 million), up from Ksh192.5 million ($1.45 million) in the previous year.
“The combined profit declined on the back of a spike in interest rates, inflation-driven increase in construction costs, and the decision by the REIT Manager to provide a maintenance reserve for the I-Reit to support the long-term quality and value of the assets,” stated Acorn in a released statement.
Kirathe’s Acorn Holdings: Transforming Kenya’s real estate landscape with $82.7-million portfolio
Acorn Holdings, under Kirathe’s leadership, has established itself as a key player in Kenya’s real estate sector, with a portfolio boasting over 65 successful projects and assets valued at Ksh11.8 billion ($82.7 million).
The company’s focus remains on projects within the Nairobi Metropolitan Area, with a portfolio that includes 17 properties totaling 17,000 Purpose-Built Student Accommodation (PBSA) beds and 6,000 operational beds across nine properties.
In a strategic move, Acorn Holdings transferred two completed hostel properties valued at $24.8 million to its Investment Real Estate Investment Trusts (I-REITs) in 2023. These properties, Qwetu Hurlingham and Qwetu Aberdare Heights II, developed under the Purpose-Built Student Accommodation (PBSA) initiative, further bolster Acorn’s presence in Nairobi’s real estate market.
