NRZ Pension Fund launches $8 million REIT IPO

NRZCPF Board Chairman, Mr Takunda Madanha

BULAWAYO – In a move to revitalize its real estate portfolio and offer enhanced pension benefits, the NRZ Pension Fund has launched an Initial Public Offering (IPO) for its Revitus Real Estate Investment Trust (REIT).

The fund is seeking to raise $8 million by selling 121,378,791 units priced at $400 each. The offering commenced today with plans to conclude by December 7, 2023, followed by a listing on the Zimbabwe Stock Exchange (ZSE) scheduled for December 15, 2023.

The launch event, which took place yesterday in Bulawayo, showcased the new venture to the public with representatives from DATVEST in attendance. The Revitus REIT aims to capitalize on urban regeneration opportunities by refurbishing properties within its portfolio to boost income generation. This strategic initiative comes as a response to the economic shifts that have led to decreased occupancy rates in major office buildings across Zimbabwe’s central business districts.

The ZSE CEO Justine Bgoni highlighted the advantages of REITs in terms of tax efficiency and liquidity for pension funds. He also noted their role in deepening capital markets and their growing appeal in Zimbabwe. REITs present a compliant investment vehicle for pension funds under IPEC regulations, facilitating partial property disposals.

Managed by Datvest on behalf of investors, Revitus REIT will also offer smaller pension funds the chance to invest in real estate, enhancing liquidity. The REIT currently includes five buildings set for development in Harare and Bulawayo. The IPO launch marks an opportunity for investors to access a strong real estate portfolio with the allure of tax exemptions and the potential for reliable dividends from net rental income.

Despite being relatively new in Africa, REITs are gaining traction as an investment class that can provide stable returns even amid challenges such as low occupancy rates in major office buildings. The Revitus REIT IPO represents an innovative step towards restoring confidence in Zimbabwe’s pensions industry while offering a tangible investment option for local and regional investors.

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