UHomes Real Estate Investment Trust Fund and UPDC Real Estate Investment Trust Fund are among the NGX-listed REITFs. Both have released their 2025 financial results, reporting strong performance.
On price valuation, performance has been relatively impressive. In 2025, UH REITF outperformed UPDC REITF with a 42% price YtD gain.
The rally has continued in 2026, with a 39.83% against UPDC’s 18.84% as of the close of trading on April 2, 2026
However, their market cap UPDC is lightly higher than at N21.8 billion compared to UHome’s N18.13 billion.
But before we get into the numbers, what is driving this outperformance fundamentally aligns with the price valuation. Which company offers the best value
What REITs offer investors
Union Homes REIT and UPDC REIT are structured to pool investor funds and invest in income-generating properties such as residential estates, shopping malls, office spaces, and warehouses.
In return, they distribute a portion of their earnings as dividends to investors. In simple terms, REITs give investors access to real estate returns without the burden of owning or managing property directly.
Investors can participate either by purchasing units on the exchange or by investing through real estate mutual funds.
According to the SEC weekly report on Collective Investment Schemes as of January 23, 2026, there are six real estate investment trust (REIT) mutual funds, including those linked to Union Homes and UPDC.
Others include the Housing Solution Fund, Ministry of Finance Incorporated Real Estate Investment Fund (MOFI REIF), Nigeria Real Estate Investment Fund, and the SFS Real Estate Investment Trust Fund.
These funds are managed by professional fund managers and provide indirect exposure to real estate assets.
In 2025, the six REITF mutual funds delivered an average return of 19.7% with UPDC-linked funds managed by Stanbic IBTC Asset Management Limited, offering 30% YtD, the highest among the group.
However, this still trails the 38% year-to-date gain recorded by UPDCREIT on the NGX, highlighting a key divergence between NAV-driven mutual fund returns and market-driven share price performance.
Financial performance
Over the past five years (2021–2025), both REITs have demonstrated consistent revenue generation and profitability.
While UH REITF has remained profitable throughout the period, accumulating over N20 billion in total profit, UPDC REITF recorded just one loss in 2021 before returning to profitability, with cumulative earnings of about N13 billion over the same period.
Profitability in 2025
UHomes’net income (excluding swap and revaluation gains) increased by 8.5% to N1.147 billion, while UPDC’s net income, excluding swap and revaluation gains, increased by about 30% to N2.3 billion
However, including swap and revaluation on property, UHomes REITF’s net income stood at N18.218 billion compared to N1.045 billion in 2024.
On the other hand, UPDC’s profit with swap and revaluation declined by 7.7% to N4.335 billion.
From the foregoing, while UHOMES delivered stronger headline earnings driven by revaluation gains, UPDC outperformed on underlying profitability, recording faster growth and higher core income.
Earnings per share
Whether driven by fundamentals or optics, the impact has already been reflected in earnings per unit (EPS).
UHOMES REITF’s EPS grew to N96.84, compared to UPDC REITF’s N1.62, highlighting the impact of revaluation gains. This divergence is important, as it directly affects investor returns, particularly dividend payouts.
Dividend payment
UHOMES REITF proposed dividend payment of N1.032 billion for 2025 reflects a 7.7%; a N4.13 per share.
In contrast, UPDC REITF paid an interim dividend of 22 kobo per unit and proposed a final dividend of 33 kobo per unit, which is 55 kobo.
So, UHOMES offers a much higher payout compared to UPDC, though the payout was tied to valuation gains rather than core income.
Sustainability in 2026
A key issue investors should watch is who is generating more income from its properties, because strong asset growth is good, but cash flow is what sustains dividend payments and expansion.
- UPDC’s investment in properties stands at N29.56 billion (up 8.64% YoY) and the rental income of N1.74 billion (up 21% YoY), suggesting that it generated 5.9% rental yield on its property portfolio.
- On the other hand, UHomes generated 2.8% rental yield based on its investment in properties of N26.21 billion (+163% YoY) and rental income of N723.6 million (+17.06%).
Another important measure of sustainability is operational efficiency; how much revenue is consumed by operating expenses.
- In the case of UPDC REITF, expense to revenue ratio increased to 14.09% from 14.10% in 2024, suggesting operational efficiency consistency.
- For UHomes REITF, the expense-to-revenue ratio declined to 1.33% from 17.26% in 2024.
- This is a significant improvement, but it is largely driven by the surge in reported revenue, driven by revaluation
Balance sheet:
UPDC REIT has the largest property portfolio, of N29.595 billion (+8.64%) in investment properties, which makes up nearly 82% of its N36.290 billion total assets.
Union Homes REIT holds about N26.215 billion (+163%) in investment properties relative to its N29.178 billion (+131.1% YoY) total assets, which is about 90% of total assets.
While both REITs operate with sizeable portfolios in the context of Nigeria’s REIT market, their asset base remains modest relative to the country’s massive housing deficit. The company’s N30 billion investments in properties are solid, but in Nigeria’s housing market, it is still small.
Valuation:
Size alone doesn’t tell the whole story; what matters is how much value each REIT creates for investors.
- Earnings per unit: Union Homes – N96.84 | UPDC – N1.62
- P/E ratio: Union Homes – 0.75x | UPDC – 5.06x
- P/B ratio: Union Homes – 0.65x | UPDC – 0.57x
- P/S ratio: Union Homes – 0.0039x | UPDC – 3.65x
Here, UHOMES looks cheaper across most valuation metrics:
- A P/E of 0.75x suggests the stock is trading at less than 1x earnings
- An extremely low P/S ratio reinforces the idea of deep undervaluation
These low multiples are largely driven by revaluation-heavy earnings, which inflate reported income.
UPDC, on the other hand:
- Trades at a higher P/E of 5.06x
- Has a more “normal” P/S ratio of 3.65x
This reflects earnings that are more operationally driven and less distorted by revaluation gains
Overall, UPDC earns more from what it owns, while UHOMES owns more than it currently earns from and in 2026, the better choice depends on whether investors prioritize steady income or growth potential.
