Kenya’s First Green Dollar I-Reit Surges 23% After Nairobi Securities Exchange Listing

Kenya’s first green US dollar-denominated Income Real Estate Investment Trust (I-Reit) has recorded a strong debut on the Nairobi Securities Exchange (NSE), with its unit price rising 23 percent within days of listing, reflecting growing investor appetite for foreign currency investment products.

Trading data shows the green dollar I-Reit opened at $1 per unit when it listed on June 29 before climbing to $1.23, a level it has maintained into July.

Performance of the newly listed product signals increasing confidence in investment vehicles that provide returns in hard currency while giving investors exposure to income-generating commercial real estate.

Developed around green-certified properties, the I-Reit offers investors an opportunity to earn regular income from environmentally sustainable real estate assets without directly purchasing or managing buildings.

Manufacturers drive demand for dollar investment

Nairobi Securities Exchange Head of Trading, Data and Analytics David Wainaina attributed the strong market reception to growing demand from manufacturers and exporters whose businesses generate revenue in foreign currencies.

Companies operating within Kenya’s Export Processing Zones (EPZs) have emerged among the key investors because their operations are largely denominated in US dollars, making the product a natural fit for their treasury and investment strategies.

“The green dollar I-Reit is trading at the secondary market in dollars. It is a very attractive investment product, especially for businesses that run their operations locally in dollars. The listing price was $1 per unit and now it is trading at about $1.23 per unit. It has done very well,” Wainaina said.

Trading of the instrument has also demonstrated the Nairobi Securities Exchange’s ability to support multi-currency securities, marking an important milestone in the evolution of Kenya’s capital markets.

“It is also a good demonstration that the NSE trading platform can support multi-currency instruments because this one has been issued in hard currency, indicating that the exchange can now support trading in foreign currencies,” Wainaina added.

Growing interest in the investment has also been driven by its role as a hedge against exchange rate fluctuations.

Manufacturing firms, exporters and businesses with significant dollar-denominated revenues can preserve value by investing in an asset that generates income in the same currency used in their commercial operations.

“It is also a good hedging product for manufacturing companies. It is a good product for hedging, especially for those businesses that deal with foreign currency,” Wainaina said.

Income Real Estate Investment Trusts allow investors to pool capital into professionally managed commercial property portfolios instead of purchasing buildings individually.

Rental income generated by the underlying assets is distributed to investors as dividends, while unit holders also benefit from any appreciation in the value of the trust over time.

Landmark listing backed by green commercial assets

The green dollar I-Reit entered the market following a highly successful public offer that attracted demand above the targeted amount.

Kenya’s first green dollar-denominated I-Reit, valued at nearly Sh5 billion ($37.3 million), achieved a subscription rate of 103.3 percent, underscoring strong investor confidence in innovative capital market products linked to sustainable infrastructure.

Offer was backed by Two Rivers Land Company Special Economic Zone, which acted as the transaction’s promoter.

Units were priced at $1 each, with a minimum investment threshold of 1,000 units, making the product accessible to both institutional and retail investors.

Trific Ltd, the special economic zone developer behind the transaction, sought to raise approximately Sh3.9 billion ($29.8 million) but ultimately secured about Sh4 billion ($30.8 million) from investors.

Two Rivers SEZ contributed an additional Sh1 billion ($7.46 million) through the transfer of Trific North Tower into the trust, increasing the overall value of the I-Reit to just under Sh5 billion.

Funds raised through the transaction will finance the acquisition of Trific North Tower and support the construction of additional environmentally sustainable commercial buildings within the Two Rivers International Finance and Innovation Centre Special Economic Zone in Nairobi.

Trific North Tower is already fully developed, fully occupied by tenants and generates rental income in US dollars, providing investors with immediate exposure to stable cash flows.

Launch of the product coincides with significant tax reforms aimed at making Real Estate Investment Trusts more attractive to property owners and investors.

Recent amendments under the Finance Act permanently exempt transfers of property into registered REITs from both Stamp Duty and Capital Gains Tax, eliminating costs that previously discouraged property owners from transferring assets into investment trusts.

Property owners had previously faced stamp duty of four percent on urban properties and two percent on rural properties, alongside potential capital gains tax liabilities during asset transfers.

Removal of those taxes is expected to encourage more developers to establish REITs while expanding the range of professionally managed property investment products available on the Nairobi Securities Exchange.

Strong performance of the green dollar I-Reit is also expected to encourage future listings of foreign currency-denominated investment products, broadening financing options for developers while giving investors greater opportunities to diversify their portfolios.

Growing demand for sustainable investment vehicles mirrors global trends where environmental, social and governance (ESG) considerations are increasingly influencing capital allocation decisions.

Successful listing of Kenya’s first green dollar I-Reit demonstrates the increasing sophistication of the country’s capital markets and highlights investor willingness to back innovative financial products that combine hard-currency returns, sustainable real estate development and long-term income generation.