Analysis: what the supplement changes and what it leaves open

The supplement converts a cash obligation into a unit obligation. Paying for ALP North Three with 4,998,485 consideration units means the trust does not have to spend down its USD 14,738,083 cash balance to acquire the asset, and it means existing unitholders take the dilution instead. At an offer price of USD 1.00 per unit against a reported net asset value per unit of 1.0431, units issued at par are being handed over slightly below the carrying value the trust reports for itself. Whether the units issued match the value of the property transferred depends on the valuation of ALP North Three, which the announcement does not disclose. It says the valuation report can be obtained from the manager, and that report, not the announcement, is where the exchange ratio can be tested.

The interim numbers also show how little of the reported profit is recurring rent. Of the USD 233,087 in profit for the period, the larger part came from finance income on cash pending deployment rather than from operating profit, which was USD 45,482. The manager says as much, and warns that the contribution from interest income is expected to reduce while rental income increases once the remaining proceeds are invested in ALP North Three. A reader tracking this trust would therefore treat the first period as a transition, and would look at the next interim report for the first quarter in which rent and interest have traded places.

One structural feature makes that transition more predictable than it would otherwise be. The manager states that the leases are triple-net, with property operating costs substantially recoverable from tenants. Combined with 98% occupancy, that narrows the gap between gross rent and what reaches unitholders. What the announcement does not establish is tenant concentration, lease maturity profile or rent escalation terms, none of which appear in the condensed statements.

What the documents say

ALP REIT (NSE: ALP) told the market on 31 July 2026 that the Capital Markets Authority and the Nairobi Securities Exchange had approved a Supplementary Offering Memorandum, and that 4,998,485 new units would be issued to its promoter to bring a fourth property into the trust. The same announcement carried the trust’s first set of interim accounts.

The two items are linked. The supplement rewrote the unit issuance structure so that a pipeline asset could be paid for in units rather than in cash, and the interim accounts show why that matters: at 30 June 2026 the trust was still holding most of its offer proceeds in cash while it worked toward completing the seed portfolio.

What the regulator approved

On 17 July 2026 the Capital Markets Authority and the exchange approved the Supplementary Offering Memorandum issued by Africa Logistics Properties Holdings Limited, the promoter. The supplement amended the unit issuance structure to enable the transfer of the pipeline property, ALP North Three, into the trust.

Under the revised structure, up to 15,398,485 units are issued to the promoter in exchange for property transfer at an offer price of USD 1.00 per unit, with a par value of USD 1.00 per unit. That total comprises the 15,000,000 units originally contemplated for property transfer and 398,485 additional consideration units for ALP North Three. Separately, 29,550,000 units were subscribed for by professional investors through the restricted offer at the same price.

The 9,000,000 additional units first described as the green shoe option may now be used in whole or in part either to satisfy oversubscriptions under the restricted offer or as consideration units issued to the promoter for the transfer of ALP North Three. The announcement is explicit that the aggregate number of units available for issuance under the offering memorandum, including the green shoe, does not increase.

To facilitate the transfer, the promoter will be issued 4,998,485 new units, credited to its central depository account and listed on the exchange by 7 August 2026. The manager said the property is ready to be transferred and that income from it will start accruing to the trust from the date of transfer. It pointed readers to a valuation report and a structural engineer’s report available from the manager. The announcement was issued by order of the trustee, The Co-operative Bank of Kenya Limited.

The first interim accounts

ALP REIT is a United States dollar denominated income real estate investment trust listed on the Restricted Main Investment Market Segment of the Nairobi exchange. It invests in logistics and industrial property in Kenya and holds, in substance, three seed assets valued at USD 26.53 million through a special purpose vehicle.

This was the trust’s inaugural interim reporting period, so no comparative figures are presented. Rental income began accruing from the seed portfolio on 1 May 2026, after debt on the seed assets was repaid, which means the income statement covers two months of rent.

Rental and related income was USD 399,737 and other income USD 2,284, giving operating income of USD 402,021. Administrative expenses were USD 31,962, fund operating expenses USD 81,289 and set-up expenses USD 243,287, leaving an operating profit of USD 45,482. Finance income earned on undeployed offer proceeds lifted profit for the period to USD 233,087, well above the operating profit. Basic earnings per unit were 0.0058. Funds from operations per unit were 0.0059 and adjusted funds from operations per unit 0.0114, which the manager put at USD 0.47 million in aggregate against the USD 0.23 million of reported net profit.

Total assets were USD 45.18 million. Investment properties accounted for USD 26,530,905 and cash and cash equivalents USD 14,738,083, with trade and other receivables of USD 3,095,004 and contract assets of USD 680,238 making up most of the balance. Liabilities were USD 3,504,035, including trade and other payables of USD 1,326,481 and a VAT provision of USD 2,172,436. Unitholders’ equity closed at USD 41,673,057 and net asset value per unit at 1.0431. The trust reported no borrowings and occupancy across the seed portfolio of 98% during the period.

Cash flow shows the shape of the launch. Units raised USD 39,950,000 against transaction costs of USD 366,581, financing brought in a net USD 29,183,419, and USD 15,470,810 went out to acquire the subsidiary holding the seed assets. Cash rose by USD 14,345,047 from USD 394,090 at the start of the period.

Distribution policy and the regulatory frame

The board did not recommend an interim distribution, citing the two months of rental income and the fact that the acquisition of the final seed asset remains in progress. It restated the requirement to distribute at least 80% of distributable earnings.

The trust was authorised in Kenya on 8 December 2025 under the Capital Markets (Real Estate Investment Trusts) (Collective Investment Schemes) Regulations, 2013, and the announcement was issued under the Capital Markets (Public Offers, Listings and Disclosures) Regulations, 2023. Both instruments sit under the Capital Markets Act and appear on the Capital Markets Authority’s published list of regulations, alongside a 2023 amendment to the REIT regulations. The accounts were prepared under IFRS, including IAS 34 on interim financial reporting, and were approved by the board of the manager and the trustee on 30 July 2026.

The promoter describes the trust as East Africa’s first industrial real estate investment trust and reports ten years of operations and 70,000 sqm developed since 2016. The exchange’s chief executive, Frank Mwiti, is quoted on the promoter’s site saying: “The debut of the ALP REIT is a historic milestone for our market.”