Jamaican investors with an interest in the new US dollar real estate fund established by the JMMB group in the Dominican Republic — when it becomes open to them — will need a minimum $127,000 (US$1000) to invest as well as the ability to speak Spanish.

The JMMB Group, home-grown in Jamaica, has spread its wings regionally to Trinidad and Tobago and the Dominican Republic where it is now expanding its portfolio of investment offerings.

After launching four new unit trust funds in Jamaica, in May 2015, JMMB Group’s Dominican Republic subsidiary, JMMB Sociedad Administradora de Fondos de Inversión, SA (JMMB Funds DR), introduced its first US$ Real Estate Closed Investment Trust (REIT) fund, which raised US$2.9 million between Friday, July 29, and Thursday, August 18, in an initial public offering (IPO), as part of the fund’s issuance programme.

The new fund which is valued at US$25 million, is a portfolio including real estate assets in the Dominican Republic, mainly corporate, commercial, storage, industrial and health.

In a release announcing the new product last week, JMMB said the fund is expected to become available to JMMB Group clients, outside of the Dominican Republic, upon the issuance of other tranches over the next 36 months.

These investors would, however, be required to open a trading account with JMMB Puesto de Bolsa and be able to communicate in Spanish, the official language of the Dominican Republic.

It was noted that the newly introduced REIT fund is designed for individuals, as well as financial and corporate institutions, that have “a moderate risk appetite and are interested in investing in US dollars, over the long-term”.

Investors can start with a minimum of 1,000 units, priced at US$1.00 per unit. These units may be later sold on the secondary market, after the initial placing period is finalised.

Edgar Del Toro, JMMB Funds DR’s CEO, was quoted as saying the product will “revolutionise the real estate market, as well as the stock market, as an investment alternative in (US) dollars; giving small, medium and

large investors the opportunity to access the investment in the real estate market, without the challenges of making the arrangements for these properties or investing the initial outlay of money.”

“This investment will also provide investors with continuous cash flow through the rental fees and the capital gains generated from the assets revaluation over time. Returns above 5.5 per cent are expected for this investment, as it offers diversity and depth in the Dominican Republic stock market,” it was stated.

JMMB indicated that it expected investors to swap low-performing assets for its new offering.

“The REIT fund will allow investors to replace assets that are no longer productive with investments that generate major added value, contributing to the growth of the individual investor’s wealth or appreciation of a corporation’s portfolio, while also spurring growth in the Dominican Republic’s economy,” JMMB said.

As at August 5, the US$165 million DR fund industry, manages US$24.5 million in close-ended REIT funds; of which JMMB funds DR’s investment portfolio comprising US$3.1 million from its money market fund. With the introduction of the JMMB REIT fund, the company plans to tap into the closed REIT fund market and also increase its market share of the DR funds market, the company said.