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KUWAIT CITY, Oct 17: According to informed sources, the government has been preparing, via the Kuwait Investment Authority and the Public Institution for Social Security, to pump operational investments into the Kuwait Stock Exchange (KSE) to benefit from the circulating liquidity boom, and then achieve regular returns within the framework of providing attractive alternatives and options for investment, reports Al- Rai daily. They explained that there are three strategic projects that are currently being researched in preparation for presenting them to the market in the form of investments with a total value of approximately KD 300 million. State-owned properties will be offered through income-generating real estate investment trust (REIT) with an average capital of KD 100 million for each of them.
These are funds that own and manage income-generating real estate and real estate assets. This comes in light of the strategy for developing government activities and providing operating models that attract capital. There are discussions taking place between the Kuwait Investment Authority and the Public Institution for Social Security to develop an appropriate mechanism for the exploitation of affiliated and managed properties by the two sides by listing them under the umbrella of real estate funds. They will be offered to retirees at first for subscription, and then presented to the stock exchange as an investment model loaded with returns that can be traded on the screen officially for the public according to the mechanisms of demand and supply.
Within one of the three projects, the talks dealt with the idea of exiting the Kuwait Investment Authority from the National Real Estate Portfolio, with a capital of KD 250 million in favor of the Public Institution for Social Security, if it had the desire to complete the process, provided that the assets owned by the portfolio (investment, residential and commercial real estate) would all be transferred to the Public Institution for Social Security in preparation for its inclusion in the REITs. The sources said, “If the idea of Kuwait Investment Authority exiting the portfolio in favor of the Public Institution for Social Security is agreed upon, the assets will be valued according to market prices, in a way that guarantees an appropriate profit margin for the Public Institution for Social Security. Coordination is underway between the two sides to launch two or three entities that give their shareholders remunerative returns and represent investment opportunities for stock market pioneers with regular returns”.