Baron&Cabot Managing Director Mark Pearson/ HANDOUT
Kenyans are being offered an opportunity to invest in the UK residential property market with a minimum investment of about $27,000 (Sh3.5 million), as interest in overseas assets grows.
The investment opportunity, being promoted by Dubai-based Tokinvest, gives eligible professional and high-net-worth investors exposure to a residential property in Birmingham.
It comes at a time when Kenyan investors are gaining access to more international investment products, including the planned participation in the Dangote Petroleum Refinery IPO through a Global Depository Receipt structure approved by the Capital Markets Authority.
The UK property investment is tied to Great Hampton Street Works, an £8.55 million (Sh1.5 billion) property in Birmingham comprising 29 fully occupied apartments.
According to the promoters, investors will have economic rights linked to rental income generated by the apartments as well as potential proceeds from a future sale of the property.
For Kenyan investors, the investment provides an opportunity to hold an asset outside the local property and financial markets, while also gaining exposure to the British pound.
However, returns for local investors could be affected by movements in the exchange rate between the pound and the shilling.
Mark Pearson, managing director of Baron & Cabot, said growing access to international investments was giving African investors more options for diversifying their wealth.
“We are seeing a growing awareness that African investors do not have to limit their wealth to their home markets,” said Pearson.
Michael Leighton, founder and chief executive of API Global, said high capital requirements and complex investment structures had traditionally made international property difficult for Kenyan investors to access.
He said the Birmingham opportunity was aimed at making established overseas property markets more accessible to eligible investors.
The investment is restricted to professional and high-net-worth investors and is subject to regulatory requirements, suitability assessments and compliance checks.
Investors will also need to consider risks associated with property prices, rental income, currency movements and the eventual sale of the underlying asset.
The offering comes as Kenyan investors increasingly look beyond traditional local investments amid efforts to spread portfolio risks across different markets and currencies.
A Nairobi investor briefing is scheduled for October 13 at the Hyatt Regency Nairobi, where prospective investors are expected to receive details on the property, expected returns, risks and eligibility requirements.