Business Type: Real Estate Investment Trust (REIT) managers are companies incorporated in Kenya and licensed by the CMA to provide real estate management services in respect of a REIT. REITs are collective investment schemes that invest primarily in income-generating real estate and distribute a significant portion of their income to unitholders.
Licensing Requirements: Must be incorporated as a company, provide certificate of incorporation and memorandum and articles of association, submit a detailed business plan, have paid-up share capital of not less than KES 10 million, maintain shareholders’ funds not below KES 10 million at any time, ensure minimum paid-up share capital remains unimpaired and is not advanced to directors or associates, and maintain working capital not below 20% of prescribed minimum shareholders’ funds.
Government Fees: Application fees are approximately KES 150,000, with annual renewal fees of around KES 100,000.
Timeline: The approval process typically takes 90 days, accounting for the review of real estate management expertise, governance structures, and compliance with REIT regulations.
Limitations: REIT managers must appoint a trustee and comply with REIT regulations, invest primarily in income-generating real estate, distribute a minimum percentage of income to unitholders (typically 80% or more), provide regular valuations of real estate assets, maintain proper governance structures, and comply with investment restrictions.
Penalties: Violations may result in suspension from managing REITs, license revocation, investor claims, fines up to KES 5 million, public censure, and prosecution for fraud or mismanagement.
Enforcement: The CMA conducts REIT compliance reviews, monitors investment portfolios, reviews real estate valuations, ensures proper income distribution, and protects investor interests through regular oversight.