Small Investors Shut Out As Property Funds Shift Focus To Big Players

Robai Ludenyi

Individual investors in Kenya’s real estate market are increasingly being left on the sidelines as property funds and issuers continue to structure their offers to favour large, institutional investors over everyday savers. This trend is shutting out ordinary Kenyans who once had hope of owning a slice of income-producing property through funds such as Real Estate Investment Trusts (REITs).

The Nairobi Securities Exchange (NSE) and industry insiders say the issue is not simply about capital it’s about how property funds are being marketed and allocated. Many issuers are now avoiding open offers that allow retail participation, instead targeting institutional investors they consider sophisticated and stable. The result? Smaller investors, including many middle‑class Kenyans with modest savings, find themselves locked out of investment opportunities once marketed as accessible and inclusive.

Frank Mwiti, chief executive of the NSE and vice‑chair of the REITs Association of Kenya, emphasised that issuers decide who they want to target when they launch these funds. But he also acknowledged that this preference for large investors could slow the development of a balanced and inclusive capital market, leaving retail investors with few alternatives to property ownership.

Real estate funds were supposed to democratise property investment. By pooling money from many investors, REITs allow people to earn rental income and benefit from property price growth without needing millions of shillings to buy land or buildings outright. But as more offers favour institutional buyers, this promise is fading.

The trend also raises questions about the effectiveness of current market regulations and whether more needs to be done to protect retail investors and ensure broader participation in wealth-building opportunities. As long as property funds prioritise big money over small savers, ordinary Kenyans may remain shut out of one of the country’s most lucrative asset classes.

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