In 2023, Nigerian Real Estate Investment Trusts (REITs) such as UH REIT, SFS REIT, and UPDC REIT collectively achieved a rental income of N2.16 billion, marking a 12% increase from the N1.93 billion recorded in 2022.
Real Estate Investment Trusts (REITs) function similarly to mutual funds. These publicly traded companies own, manage, or finance income-generating real estate assets, including office buildings, shopping malls, apartments, hotels, and warehouses. By pooling capital from numerous investors, REITs can acquire and manage income-producing properties and mortgage loans.
REITs come in three types: equity REITs, mortgage REITs, and hybrid REITs. Equity REITs focus on acquiring, holding, and managing commercial and rental properties to generate profits.
Mortgage REITs invest in real estate mortgages, using properties as collateral for their loans. Hybrid REITs combine both strategies, investing in both properties and mortgages.
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Currently, Nigeria has only equity REITs. Among them, UPDC REIT led in rental income for the year, earning N1.44 billion.
UPDC REIT – N1.44 Billion
UPDC REIT, established by UPDC in 2013 and managed by Stanbic Asset Management Limited, oversees several prominent properties including:
- Victoria Mall Plazas 1 and 2, Victoria Island
- Pearl Hostel, Pan-Atlantic University, Ibeju Lekki
- UAC Commercial Complex, Abuja
- Kingsway Building, Marina, Lagos
- Abebe Court, Ikoyi Lagos
- Project Stack, Lagos
In 2023, UPDC REIT generated N1.44 billion in rental income, an increase from N1.26 billion in 2022. However, its share price, which appreciated by 115% to N6.40 during the year, later declined by 37.5% to N4.00 as of May 20, 2024.
SFS REIT – N190 Million
Managed by SFS Capital Nigeria Limited, SFS REIT posted a rental income of N190 million in 2023. The trust also recorded a total income of N395.4 million, including N147.7 million in interest income. This represented a 70% growth from the N186.6 million net income in 2022.
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As the smallest REIT in Nigeria, SFS REIT manages properties across Lagos, including:
- Harold Sodipo Crescent, Ikeja GRA
- Victory Park Estate, Lekki
- Bourdillion Court, Lekki
- Milverton, Lekki
- Cromwell Estate, Lekki
- Maben Estate, Chevron Drive, Lagos
- Victoria Crest Estate, Lekki
Notably, SFS REIT generated N54.8 million from its properties in Milverton, Lekki, and N29.7 million from Victory Park Estate, Lekki. Its share price appreciated by 31.6% in 2023, from N77 to N101.35, and remained at N101.35 as of May 20, 2024.
UH REIT – N531.3 Million
Listed on the NGX since 2008, UH REIT recorded a rental income of N531.3 million in 2023. The total market value of UH REIT assets was N10.04 billion at the end of 2023, up from N9.82 billion in 2022. UH REIT receives rent from various properties in Lagos and Abuja, including:
- McDonald Court, Ikoyi
- Locke Apartments, Lekki
- 9, Mike Akhigbe Way, Abuja
- Plot 3, Block A4, Olusegun Aina Street, Ikoyi
- Savannah Court Estate, Victoria Island
- Amina Court, Apo, Abuja
- 28A, Rumen Property
Throughout 2023, UH REIT’s share price remained consistent at N36.60 and closed at the same price on May 20, 2024.
