High-end Commercial Property for Staff Pension Scheme

Dr. Aukot cuts the cake to mark the launch of the commercial project

Dr. Aukot cuts the cake to mark the launch of the commercial project

JKUAT Staff Retirement Benefits Scheme (JKUATSRBS) is set to diversify its investment portfolio following the acquisition of a plot measuring 1.9 hectares to set up a multi-billion commercial project targeting high end clients in the affluent Kilimani area in Nairobi, Thursday, June 19, 2014.

JKUAT Chairman of Council Dr. Ekuru Aukot, while presiding over the groundbreaking ceremony for the construction of the JKUATSRBS Towers, lauded the Trustees for recognizing that areas such as Kilimani are at the ‘rising phase’ which is characterized by high selling prices for office space.

“This investment strategy”, he noted, will ensure that “the rate of return on member balances is maximized through diversification of the scheme portfolio,” adding, the pension sector which today controls billons of shillings, “has become a force to reckon with in the real estate sector by utilizing its long term funds in realizing significant gains for its members and assuring their financial security in retirement.”

Dr. Aukot appreciated the good job done by the sponsor and the trustees and urged them to ensure “the scheme is managed effectively and efficiently and in accordance with its trust deed rules at all times for the benefit of all stakeholders.”

Dr. Aukot puts his earth-moving-machine driving skills to test during the breaking of the ground for the project construction.[1]

Dr. Aukot puts his earth-moving-machine driving skills to test during the breaking of the ground for the project construction

The particular area where the development project is located has high end demand for office space. According to the Pensions Manager Mr. Fredrick Munyoki Nzui, the board of trustees are keen to diversify the portfolio by investing in the property asset class to maximize on the gains from the property asset class for the members’ benefit within the guidelines of the Retirement Benefits Act and the Scheme’s investment policy statement (IPS).

The SRBS Towers that will come up is poised to address the demand for space that meets international standards in areas close to Nairobi CBD.

Speaking on behalf of the sponsors, Vice Chancellor Prof. Mabel Imbuga said it was heartening to note that the scheme was very stable having rose from 2008, when it was just Ksh. 58 million, to the current status where the scheme can transact business to the tune of billions, and thus urged the JKUAT SRBS management to ensure that the development projects undertaken by the pension scheme improves the welfare of staff and the country.

The Vice Chancellor also urged the contractors to expedite the work so as to complete it within the projected timeline of 24 months.

Prof. Imbuga also appealed to the contractors to the also consider internship opportunities to the JKUAT students.
The Chairman of the board of trustees Amb. Steven Loyatum acknowledged the significance of the project which is “set to change the skyline of the Kilimani area.”

At the construction site.

At the construction site

Amb. Loyatum congratulated the team that actualized the project from conception, noting, “They are part of the successful journey to completion,” and further reassured all the stakeholders that “the board of trustees remains committed to providing and sustaining efficient and effective retirement benefits services.”

To actualize the project, the trustees have structured a mix of equity and debt in line with the Retirement Benefits Act and the Scheme’s Investment Policy statement.

The main contractors of the JKUATSRBS Towers are Landmark holdings. The first phase of the construction will consists of basement levels, a lower floor and 14 regular floors that will constitute the first tower at an estimated cost of Ksh. 1.7 billion. The estimated rate of return of between 10 -14 percent.

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