Republic REIT posts modest gains amid real estate market shifts

…fund eyes residential-focused expansion strategy in 2025

Republic Real Estate Investment Trust (Republic REIT) closed 2024 with modest growth in fund value, capitalizing on improving conditions in Ghana’s real estate sector despite persistent macroeconomic and structural constraints.

According to the fund manager’s annual report, Republic REIT’s total fund value rose to GH¢66.34 million, up from GH¢ 60.15 million in 2023. This marks a 2.69 percent increase, attributed to favourable asset price movements and strategic portfolio realignments. The trust reported an annualized yield of 8.16 percent for the year.

The Chief Executive Officer, of Republic Investment, Madeline Nettey noted that a sub-fund, Republic REIT SC, delivered a stronger performance, returning 20.12 percent over the same period.

She said that the SC’s lower exposure to price volatility as a factor underpinning its higher yield. The REIT had a total of 6,319 unitholders by year-end.

The report comes at a time when Ghana’s real estate sector is navigating a complex landscape shaped by policy reforms, demographic trends, and economic pressures. Industry estimates place the market’s total value at US$389.1 billion, with the residential segment continuing to dominate due to a nationwide housing deficit exceeding 1.8 million units.

“Affordable housing remains a critical area,” Ms. Nettey noted, pointing to sustained demand across both low-income and luxury segments. Private developers, often in partnership with the government, have increased supply efforts targeting middle-income and expatriate populations in areas like East Legon and Cantonments.

While residential demand drove value in the fund’s portfolio, exposure to commercial and industrial assets was limited. Real estate and property-focused investments made up 29.17 percent of Republic REIT’s asset mix, including land banks, construction finance, and residential property. The remainder of the portfolio was diversified into fixed-income assets—44.78 percent in Government of Ghana securities, 20.58 percent in money market instruments, and small allocations in collective investment schemes and cash.

The REIT’s cautious asset mix reflects broader challenges across the industry. Developers continue to grapple with high construction costs, legal disputes over land, and limited access to affordable financing. High interest rates have also dampened the appetite for credit among potential homeowners and investors.

In response, many developers, including those whose projects feature in Republic REIT’s portfolio, have turned to cost-saving construction techniques, including prefabrication and the use of local building materials.

In it’s outlook for 2025, Republic REIT plans to double down on its core strength: residential real estate. Fund managers said they are actively scouting for “high-yield real estate securities” across residential, commercial, and industrial segments, but with a clear emphasis on affordable housing.

“Maintaining liquidity while pursuing growth will guide our strategy,” the CEO stated, adding that a prudent share of assets would remain in short-term money market instruments to preserve flexibility amid market uncertainty.

The REIT also disclosed plans to align operations more closely with Ghana’s Securities Industry (REITs) Guidelines, 2019, citing transparency and regulatory compliance as strategic priorities.

While acknowledging ongoing risks, the CEO expressed optimism about the long-term outlook.

“A stable macroeconomic environment is essential,” she noted, while underscoring the importance of housing policy reforms and fiscal stability in shaping returns.

With strategic repositioning and a sharpened focus on income-generating residential assets, Republic REIT is positioning itself as a viable vehicle for long-term investors seeking exposure to Ghana’s evolving property market.

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