Harare- Zimre Property Investments has seen positive uptake of new projects despite harsh economic environment and unstable pricing of goods and services in the third quarter ended 30 September 2019.
The Company said its Sawanga Shopping Mall in Victoria Falls has started contributing to the revenue streams, with the company having achieved an operating profit of $5.91 million in the period under review.
The Nicoz House Bulawayo student accommodation facility reached full capacity in terms of student intake and is also contributing to the Company’s revenue earnings.
Positive responses to the company’s initiatives was evidenced by a 101% increase in rental income which amounted to $3.27 million for the said period compared to $1.63 million during the same period in the prior year.
The increase was attributed to quarterly rent reviews necessitated by the hyperinflationary environment in the country which has seen continuous adjustments of prices of goods and services.
Also, on a positive growth trajectory in the period under review were stand sales which realised a 537% growth from $0.46 million in the prior year to $2.93 million as at 30 September 2019.
The achievement of new lettings together in the quarter as well as the continuous space reconfiguration resulted in an improved voids situation which saw them declining from 28% to 22% in the period under review.
Despite the Company’s sound financial position, portfolio performances were affected by the volatile economy characterised by power outages, cash shortages, price hikes of goods and services among other things.
Demand for real estate products declined during the period under review due to the tight liquidity situation and waning consumer purchasing power.
Rental revenues declined in real terms and debtors remained a major problem for the business as the general economic environment increased overall tenant default risk.
On the outlook, Zimre says it aims to survive the turbulent times and preserve value for shareholders and launching a number of projects in 2020 based on strategic pieces of land the Company has amassed over the years.
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