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Acorn Holdings, a renowned property developer based in Nairobi and founded by Kenyan real estate billionaire Edward Kirathe, has announced plans to pay dividends of Ksh482.8 million ($3.64 million) to unit holders of its two real estate investment trusts (Reits).
The company’s move to reward unit holders came after it declared its first payout from its development Reits, which exceeded the initial prediction. Despite a decrease in net profit to Ksh71.6 million ($540,000) from Ksh384.2 million ($2.9 million) in 2022, owing mostly to reduced fair value gains on investment properties, Acorn Holdings is dedicated to providing returns to its shareholders.
Acorn’s 2023 financial report shows a decline in net profit to Ksh71.6 million ($540,000) from Ksh384.2 million ($2.9 million) in 2022. The drop is mostly due to fewer fair value gains on investment properties.
Despite this setback, the company’s Reits have enjoyed dividend growth, with the Acorn Investment Reit (I-Reit) boosting its total distribution for the year to Ksh242.8 million ($1.83 million), up from Ksh192.5 million ($1.45 million) 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,” the statement said.
Acorn Holdings, led by Kirathe, has established itself as a prominent participant in Kenya’s real estate sector, with a portfolio of over 65 successful projects and assets worth Ksh11.8 billion ($82.7 million).
The company’s primary concentration is on projects in the Nairobi Metropolitan Area, with a portfolio of 17 buildings comprising 17,000 Purpose-Built Student Accommodation (PBSA) beds and 6,000 operational beds spread over nine locations.
In a strategic move, Acorn Holdings transferred two finished hostel buildings worth $24.8 million to its Investment Real Estate Investment Trusts (I-REITs) in 2023. These complexes, Qwetu Hurlingham and Qwetu Aberdare Heights II, were built under the Purpose-Built Student Accommodation (PBSA) plan and strengthen Acorn’s position in Nairobi’s real estate market.
