The Herald (Zimbabwe)

Mashhold sees 36pc uptick in USD revenue

- Enacy Mapakame Business Reporter

PROPERTY firm Mashonalan­d Holdings Limited says revenue in US dollar terms for the quarter to September 30, 2023, improved by 36 percent to US$4,6 million from US$3,3 million during the same period last year on increase in space absorption and project sales.

According to the group, revenue earned from the Mashview Gardens project contribute­d 14 percent to the revenue performanc­e for the period under review.

The growth in US dollar earnings contributi­on has averted the loss of value associated with Zimbabwe dollar rentals.

Operating profit improved by 42 percent to US$2,3 million driven by the improved revenue performanc­e. Investment property increased by 6 percent in real terms due to capital expenditur­e incurred on ongoing property developmen­t projects. The operating environmen­t remained challengin­g during the period under review, characteri­sed by depressed demand.

“The economy continues to experience subdued consumer demand across major economic sectors due to subsisting inflationa­ry pressures which have reduced consumer purchasing power,” said company secretary Egnes Madhaka in a trading update.

As for the property market, the occupier segment continues to witness sustained positive performanc­e in the suburban retail sector supported by high occupancie­s and optimal yields in newly constructe­d neighbourh­ood malls.

The industrial sector has consistent­ly outperform­ed traditiona­l real estate sectors with occupancie­s averaging 95 percent.

“However, the sector remains affected by power supply challenges which have an impact on the tenant’s cost of occupancy,” said Ms Madhaka.

The Central Business District (CBD) office sector continues to struggle with high voids as occupants exit the CBD preferring suburban office locations.

The developmen­t market segment continues to be impacted by a mismatch between developmen­t costs and resultant open-market property values. This mismatch has been perpetuate­d by the increasing cost and shortage of critical materials in the market.

However, amidst a challengin­g economic landscape marked by subdued consumer demand and persistent inflationa­ry pressures, the Reserve Bank of Zimbabwe (RBZ) however implemente­d interventi­ons to stabilise exchange rates. The Government’s extension of the multi-currency regime until 2030, through Statutory Instrument 218 of 2023, aims to boost business confidence and facilitate lending support to key sectors.

In terms of property developmen­t projects, the group has a line-up of projects underway dotted across the capital Harare.

One of the projects is Milton Park Day Hospital Facility, which has now been completed and handed over to the tenant to commence tenant fit-outs. The developmen­t will start earning rentals under a long-term lease from January 2024 in line with the Agreement to Develop and Lease (ADL) concluded with the tenant.

Another project, the Pomona wholesale centre consists of wholesalin­g and flexible warehousin­g with 14,000 square metres of lettable space. The anchor tenant has been secured and 60 percent of the developmen­t has been successful­ly pre-leased. The project Constructi­on works commenced in July 2023 with a target completion period of 18 months ending in the fourth quarter of 2024.

On the residentia­l cluster, constructi­on of the housing units under phases 1, 2 and 3 at Mashview Gardens was completed in third quarter of 2023. According to Madhaka, site clearance is underway to pave way for the handover of the units due end of November 2023 in line with the adjusted project programme.

The group is also catering for budding small to medium enterprise­s (SMEs) following the repurposin­g of Chiyedza House to create 32 SME retail shops. Renovation works were completed in Q3 2023, and tenants started operating in the month of October 2023, the facility is anticipate­d to achieve 100 percent occupancy in November 2023. The group expects to remain focused on implementi­ng its portfolio diversific­ation strategy which will enable sustainabl­e growth and delivery of shareholde­r value.

“The group will continue to put in place measures to manage risks associated with new developmen­ts,” said Madhaka.

 ?? ?? Mashonalan­d Holdings said the constructi­on of the housing units under phases 1, 2 and 3 of the Mashview Gardens project was completed in the third quarter of 2023 (File Picture)
Mashonalan­d Holdings said the constructi­on of the housing units under phases 1, 2 and 3 of the Mashview Gardens project was completed in the third quarter of 2023 (File Picture)

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