The Capital Markets Authority has received several applications for real estate investment trusts manager licences, with "at least three" pending approval.
CMA's acting chief executive Paul Muthaura told the Star on Monday that "there is a lot of interest" in Reits, though it would be hard to place a finger on the time within which the first Reit scheme will be approved.
"It's a sign that the market appreciates the value that Reits will add in facilitating financing of developments and as alternative investment options. We are yet to get applications for actual Reit schemes... but it's because to design an actual product, there are many more considerations in structuring Reit schemes," he said on phone.
It has so far licensed two Reit managers, indicating a flurry of activity under the new product. Centum Asset Managers and UAP Investments Ltd are the only ones granted licences.
"Getting licensed as a Reit manager is evidencing that you have the technical capacity to manage funds and property and that you've the right staff and expertise," he said.
Reit managers are licensed to offer real estate management services in regard to Reits schemes which are to be listed on the Nairobi Securities Exchange.
Anne Mubia, a consultant with Viva Africa Consulting LLP, said the advisory firm is working with "quite a number" of companies to structure Reit products and preparing documentation before they can seek CMA's approval.
"Most are at conceptual stages. We are working with each depending on who wants what aspect of Reits. I think Reits are going to be very popular going by the numbers," Mubia said.
The debut of Reits is however likely to face challenges as channels of information flow that would help potential Reits buyers to make informed decisions - such as on land price changes - are yet to be established.
Valuers have in the recent past opined that Reits investors must know the movement of land prices in locations where the individual income Reits schemes are situated.
"Reits will open up a lot of information sharing," Mubia said.
For instance, the Ministry of Lands, Housing and Urban Development is supposed to provide a land index with data on prices. Such data would also help curb speculation, according to valuers.
VACL is working with British-American Asset Managers, a subsidiary of Britam Group, which intends to lodge an application for a Reit scheme with the CMA within two months. It plans to list a Reit scheme in the next few months once it gets nod from the CMA.