Hazina 254

When most people hear about real estate investing, the first picture that comes to mind is owning apartments, building rental units, or purchasing land. For many young people, this dream seems out of reach—mainly because of the high capital requirements.

But here’s the truth: you don’t need millions to become a real estate investor. With as little as a few thousand shillings, you can start building wealth through Real Estate Investment Trusts (REITs).

What is a REIT?

A Real Estate Investment Trust (REIT) is a company that pools money from different investors to invest in real estate projects. By buying REIT shares, you indirectly become a property owner and earn returns from rental income, property appreciation, or mortgages—without the stress of being a landlord.

Think of it like owning part of an apartment block, a shopping mall, or office towers, but through the Nairobi Securities Exchange (NSE).

Types of REITs in Kenya

Kenya’s Capital Markets Authority (CMA) has approved different categories of REITs to give investors a wide range of opportunities:

1. Income REITs (I-REITs)
   • These focus on income-generating real estate such as residential apartments, malls, and office spaces.
   • Investors earn returns through rental income distributed as dividends.
   • Example: ILAM Fahari I-REIT, which invests in commercial properties like Greenspan Mall.
2. Development REITs (D-REITs)
   • These focus on property development projects such as building new estates, student hostels, or shopping complexes.
   • They are riskier but can deliver higher returns if the project succeeds.
3. Mortgage REITs (M-REITs)(not yet active in Kenya)
   • These provide funding for real estate through mortgages and earn from the interest on loans.

Why Should Young Investors Consider REITs?

✅ Low Entry Barrier – You don’t need millions. With as little as KES 5,000–10,000, you can start.
✅ Liquidity – Unlike physical property that can take months to sell, REIT shares can be traded on the NSE like stocks.
✅ Diversification – Your money is pooled into a portfolio of different properties, reducing risk.
✅ Passive Income – You earn dividends from rental income without worrying about tenants or property maintenance.
✅ Regulated by CMA – Your investment is overseen by regulators, offering transparency and protection.

How to Start Investing in REITs

1. Open a CDS Account – Just like investing in shares, you need a Central Depository & Settlement (CDS) account through your stockbroker or investment bank.
2. Choose a REIT – Start with listed REITs like the ILAM Fahari I-REIT available on the Nairobi Securities Exchange (NSE).
3. Buy Shares – Decide how much you want to invest and purchase REIT units through your broker or online trading platform.
4. Track Your Returns – Monitor dividends, property value growth, and market performance.
5. Reinvest Dividends – To build wealth faster, consider reinvesting your earnings instead of spending them.

Final Thoughts

Owning property is a dream for many, but you don’t have to wait until you’ve saved millions to join the real estate game. REITs makes it possible for young investors to participate in the property market today—affordably, conveniently, and with far less risk.

At Hazina 254, we believe that true wealth is built step by step. Starting small with REITs could be the foundation of your real estate empire tomorrow.

So, instead of waiting to buy that apartment in ten years, why not start owning property today—one REIT share at a time?