Acorn Holdings, a key player in real estate development, announced a significant increase in dividends for its unitholders across its real estate investment trusts (Reits). Following the successful distribution of profits from its development Reits, Acorn has raised its total dividends to Sh482.8 million, up from Sh 192.48 million.
In a notable move, the Acorn Student Accommodation Development Reit (ASA D-Reit) marked its first distribution, disbursing Sh240 million, equivalent to Sh0.91 per unit, in December 2023. Despite a decline in net profit to Sh71.6 million in 2023 from Sh384.2 million in 2022, attributed to reduced fair value gains on investment properties, Acorn utilized retained earnings to fund the distribution.
Meanwhile, the Acorn Investment Reit (I-Reit) witnessed an increase in total distribution to Sh242.8 million, or Sh0.77 per unit, up from Sh 192.5 million in 2022. This growth, despite a profit dip to Sh 396.1 million in 2023 from Sh504.9 million in 2022, reflects Acorn’s strategic financial management amidst market challenges.
Recognizing factors such as rising interest rates and construction cost escalations, Acorn remains focused on optimizing its debt structures. Recent acquisitions, including Qwetu Hurlingham, have expanded its asset portfolio to Sh9.2 billion. Plans for hostel developments in Nairobi CBD, catering to students from renowned institutions, underscore Acorn’s commitment to sustainable growth and community development.
In summary, Acorn’s decision to boost dividends underscores its dedication to maximizing shareholder value while navigating market dynamics with prudence and strategic foresight.
photo source: Google
By: Montel Kamau
Serrari Financial Analyst
29th March, 2024
