HMK REIT extends offer to January 28
THE arrangers of Haldane McCall Real Estate Investment Trust (HMK REIT) have announced the extension of the Initial Public Offering (IPO) which opened on December 4th, 2014.
The announcement was made following the approval granted by the Securities and Exchange Commission (SEC) for the extension of the offer period.
The offer initially billed to close on January 14, 2015 has been extended to January 28, 2015 to afford interested investors the opportunity to invest in the REIT. The reasons for the extension includes the public holidays declared during the festive seasons.
According to, Managing Director of FSDH Asset Management Ltd, the Fund Manager, Olumayowa Ogunwemimo, the HMT REIT presents an opportunity to discerning investors to balance their investment portfolio and partake in stable and consistent stream of real estate income which a REIT provides as 90 per cent of income is distributed annually.
HMK REIT is offering 2,600,000,000 units at N5.15 per unit valued at N13.39 billion with a minimum purchase of 10,000 units and multiples of 2,000 thereafter to the investing public via an Initial Public Offering (IPO).
The proceeds of the offer will be used principally for the acquisition of a diverse portfolio of residential and commercial properties located in GRA Ikeja, Ikeja Central Business district and Ikoyi respectively.
The HMK REIT will invest in a portfolio of high quality residential and commercial real estate properties that are already generating income, other potential high yield real estate assets and money market instruments. A minimum of 90 per cent will be invested in Real Estate and Real Estate related assets while a maximum of 10 per cent will be in Liquid Asset Investment.
Olumayowa assured that the HMK REIT will pay consistent dividend irrespective of trends in the capital market. “The REIT is an alternative for investors at a time where equities are not doing fantastically well. It is a way of preserving value and ensuring that investors do have an opportunity to extract value from the market.
“The major difference of the HMK REIT to other portfolios is in its exposure to the different asset classes. For instance, mutual fund has exposure to equities while a REIT has exposure to real estate. So it gives you that additional benefit of investing in real estate. But the key thing most investors look out for is the dividend pay-out.
“For other mutual funds, the dividend pay-out is as decided by the investment committee or as decided by the court. But for a real estate investment trust, the dividend pay-out is decided upfront. In HMK REIT, a minimum of 90% of the income earned in any financial year will be distributed to unit holders every financial year.
“So an investor can know ab-initio that he is going to get very high per cent of whatever income is generated. You are not waiting for someone to take that decision; you already know the outcome upfront.
She said that an application has been made to the council of the Nigerian Stock Exchange for the admission of the units of the REIT into its daily official list.
Upon completion of the offering, the HMK REIT will be managed by FSDH Asset Management Limited, one of the leading Asset Managers in Nigeria; other key parties are SKYE Trustees Ltd,Trustee to the REIT and UBA Plc, Custodian of the assets.
The Issuing Houses are Goldbanc Management Associates Ltd (GMA), Lead issuing house and Co issuing houses namely BGL Capital, Capital Bancorp Plc, Greenwich Trust Ltd, LeadCapital Plc and Planet Capital Ltd.
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