ZSE courts more REIT counters

LIVINGSTONE MARUFU

The Zimbabwe Stock Exchange (ZSE) is actively promoting the listing of more Real Estate Investment Trust (REITs) on the bourse as it seeks to deepen the capital markets, its CEO Justin Bgoni has said.

The only REIT listed on the ZSE is Tigere.

“We have been doing a lot of work behind the scenes to promote the listing of additional REITs as we strongly believe that this instrument gives investors an asset class that has strong cash flows and capital growth and will aid in the economic growth through the building of new infrastructure,” Bgoni said.

According to Bgoni, the introduction of REITs has changed the game in terms of providing alternatives to the stocks that have been traded on the ZSE since 1894.

Bgoni is optimistic that more REITs will list on the ZSE.

“We are optimistic that we will be witnessing the listing of additional REITs on the ZSE, since several REITs have already been licenced by the Securities and Exchange Commission of Zimbabwe.

“The Tigere REIT had a substantial participation rate during the Initial Public Offering, shown by the 95% subscription rate. This is an indication of the appetite in the market and shows how investors are open to embracing new products,” Bgoni said.

The market capitalisation for Tigere REIT has grown 750% to ZWL$180bn since its listing on ZSE last year, a testament to the great potential of REITs in “our market, which has made us keen to promote it with one of the initiatives”.

REITs offer financial inclusion by affording investors indirect exposure to a wide variety of expertly managed properties.

Bgoni said it was critical to promote retail participation.

The ZSE and other capital market participants last week established the REITs Association of Zimbabwe to promote the growth of the REIT market and advocate for the interest of REITs with regulators and policymakers.

Mike Juru, the CEO of Integrated Properties, chairs the association.