- Occupancy levels remained unchanged from the prior quarter
- Quarterly reviews spurred rental income growth
- COVID-19 has affected tenants’ rent paying capacity
Harare – Mash Holdings’ occupancy levels for the quarter ended 30 June 2020 (Q32020) increased by 3% on prior comparative period.
Occupancy levels in the period under review rose to 79.2% compared to the same period last year but remained unchanged from the prior quarter (Q12020).
The Group’s rental income in the quarter increased by 21% to ZWL$77.71 million compared to the same period in the prior year.
The rise has been attributed to the quarterly reviews that were implemented from February 2019 and continued into the current financial year.
New lettings also contributed to the growth in rental income growth in the period.
However, rent reviews were temporarily suspended for the period May to June 2020 in a bid to assist tenants during the lockdown period, notwithstanding the runaway inflation.
The Group’s conversion of the development pipeline into leases has been affected by the lower demand for rental space, especially in the CBD office sector as a result of the COVID-19 pandemic.
Furthermore, the pandemic has resulted in a 91% decrease in average collection to revenue from 95% in the previous quarter.
Tenants’ rent paying capacity has also been negatively affected by the COVID-19 related restrictions which in turn has affected the inflation-hedging attribute of real estate investments in the Zimbabwean market.
On the outlook, the Group says it will continue to explore opportunities to preserve shareholder value through strategic property developments and targeted regeneration of existing buildings to suit emerging occupier requirements.
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