June 27th 2017

Business / News

Alexander Forbes retirement fund expands to Real Estate

Alexander Forbes Retirement Fund Board of Trustees chairperson Lucy Kambuni said the fund will continuously invest in projects that benefit members through innovation and real estate sector which has proved to be an asset class that has continuously posted positive returns over the long term.

By Waithera Murugiswaithera@kenyafreepress.comMonday, 11 Jul 2016 13:27 EAT

Alexander Forbes Retirement Fund has unveiled a new commercial development dubbed 1424 worth Sh2.5 billion that on completion will have a total build area of approximately 20,000msq with 449 parking slots in four basements. “1424” will generate superior rents as it targets high quality tenants. Our contributors will additionally earn returns through capital appreciation of the property,” James Olubayi, Alexander Forbes Executive Director, said in a statement.

Alexander Forbes Retirement Fund Board of Trustees chairperson Lucy Kambuni said the fund will continuously invest in projects that benefit members through innovation and real estate sector which has proved to be an asset class that has continuously posted positive returns over the long term.

"We are in the process of putting up a commercial development in the Westlands area of Nairobi as we continue to devise various strategies that will benefit members on a long term plan,” said Mrs Kambuni.

As part of the innovation process, the fund has initiated an income investment plan which offers members flexibility in how they utilise retirement benefits. Under this plan, members can draw down up to 15 percent of their accumulated fund for every year for their use. “By keeping their retirement fund invested, the member’s accumulated income has a chance of keeping pace with inflation over the long term,” she added. 

The Fund has also launched a post-retirement medical plan within to enable aged people access good quality medical care, the plan enables members to save whilst working  to create a pot that will fund medical care during retirement. The Divisional Head of Umbrella & Retail Solutions at Alexander Forbes, Ms Angela Okinda, who heads the management of the Fund, noted that the launch of the facility was a great landmark as it will enhance more growth for the fund.

Alexander Forbes Retirement Fund has reported a strong return for its contributors in 2015, posting a good performance despite a difficult market for investors. While addressing the members during its 8th annual general meeting, Mrs Kambuni said the fund, which now has over Sh17.5 billion in assets under management, managed to deliver a good return despite the poor performance at the stock and fixed income securities that resulted in low returns for most retail and institutional investors in 2015.

“It was a challenging year for the equities market that saw a record of 14 companies that are listed in the Nairobi Securities Exchange (NSE) issue profit warnings. At the same time the volatility in the interest rates towards the end of the year made investing in fixed income difficult,” Ms Kambuni added.

Mr James Olubayi, Executive Director, said the Fund will continue to look for strategic partners that will bring value for members, noting that the new investment will generate consistent returns for contributors while at the same time minimizing investment risks.

Since its establishment in 2005, the Fund has registered strong growth in terms of both assets and members and it is now the largest multi-employer retirement Fund in East Africa, with over Sh16 billion in assets from over 150 organizations and 30,000 members.

The Fund also provides a suitable means through which employers can contract out under the new NSSF Act and save for their retirement.

Waithera is a staff writer at the Kenya Free Press.





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