- leading real estate firms express the need to rethink property uses in Harare CBD
- Void levels increase as corporates move to Suburban areas
- FMP calls for the conversion of some CBD buildings into residential facilities
- City of Harare reviewing policy on property
- y usage in the City
There are growing clamors by leading real estate firms to rethink property uses in Harare’s Central Business District (CBD) to match market trends and cushion the sector from growing voids.
This comes as commercial properties in Harare’s central business district (CBD) have been recording increases in void levels as companies move to suburban areas. This has also been exacerbated by the pandemic which has resulted in a surge in telecommuting. Notably, Econet indicated that as much as 70% of its staff was working from home during the nationwide lockdowns.
In an exclusive interview with Equity Axis on last Tuesday’s episode of “The Earnings Review”, the MD for First Mutual Properties, a leading Real Estate player in Zimbabwe, Christopher Manyowa elucidated on the need for property usage reconsideration in Harare CBD.
“Currently the (Harare) CBD sector is under pressure due to the nuisances happening, worsened by the lockdowns and disruptions of business. It is imperative, and there is a need for strategy and the private property sector, especially the major owners of property within the CBD, now need to collaborate with the local authorities, and the element of alternative use of properties is now compelling.”
One of the options analysts have suggested include conversion of commercial properties into residential.
In light of the increasing voids in the CBD against high demand for residential space, the country’s leading property players, in conjunction with the City of Harare are exploring a number of options to remodel current buildings into alternative uses in line with market trends.
“I can confirm that FMP is a part of an organization formed 2-3 years ago called the Property Owners Association of Zimbabwe (POAZ) to engage local authorities and seek to persuade them that real estate in depressed locations had to be looked at. The City of Harare was embarking on a review of local plan 22 which is the local plan which guides and provides policy issues around how the city centre is likely to be utilised.”
Manyowa also shed light on FMP’s interest for conversion of some CBD buildings into residential facilities:
Notably, the decay of the inner city is not unique to Zimbabwe alone but a worldwide phenomenon with corporates moving out to less congested areas.
Old Mutual Zimbabwe non-executive Director and former Chief Executive Jonas Mushosho, at the group’s last AGM commented on the need for alternative building usage in the CBD:
“This has happened in other areas too like in South Africa’s central Johannesburg for instance, where companies have moved to areas like Sandton. This is always followed by a process of renewal of the inner city. A lot of work has to be done for the renewal of the inner city. We think some of the buildings in the city need not be refurbished only but to think about alternative uses as well in line with the market.” Old Mutual owns several buildings in the capital’s CBD and holds the largest property portfolio in the country.
The Managing Director for Masholdings-which owns numerous buildings in the heart of Harare, Gibson Mapfidza, earlier revealed to Equity Axis that the big 5 property companies in Zimbabwe were advocating for local authorities to consider an application for conversion of Harare CBD properties into residential use.
The Real Estate Institute of Zimbabwe (REIZ) president Mike Juru is on record on several occasions for having expressed that demand was currently on the residential properties side ahead of office space, especially in the CBD.
A trend analysis of property stocks such as Dawn Properties, First Mutual Properties (FMP), Old Mutual, Zimre Property Investments (ZPI) and Mashonaland Holdings show that commercial properties in the CBD have been problematic as demand has been skewed towards residential developments.
Indications are that business in the CBD has been on a downward trend as their commercial clients move to surrounding residential areas or Office Parks to escape congestion in the city or find a more pleasant environment.
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