Stanlib Fahari I-Reit has acquired Starling park properties LLP for 850 million, a project that includes an office block measuring 41,312 square feet.
The real estate fund is expanding its portfolio beyond Nairobi’s Eastlands area to a more middle-class area of Lavington.
This came at a cost as the company sacrificed interest income to buy the property when it utilized surplus cash on the hope that it will raise money in the future.
Stanlib, however, said the grade A three-storey building has contributed positively to a diversification of its portfolio.
The only listed Real Estate trust fund now owns four properties valued at Sh3.3 billion including the office park, and Greenspan mall, Bay Holdings and Highway House with the latter located in Eastlands.
To spruce up the mall’s entertainment scene, the fund is now constructing a 3 screen cinema with 100 seats each at Greenspan Mall to increase foot traffic in order to boost existing tenant customers and increase rental incomes.
The firm’s profitability however suffered a 16 percent decline from Sh78 million to Sh65 million on reduced rental income as tenants bargain for lower fees upon license renewal.