• Turnover increased by ZW$18.51 million

  • Occupancy scaled up two percent

  • Accredited to revamping efforts

Harare – Property management and development company, First Mutual Properties has recorded a twenty percent increase in revenue for the period ended March 31, 2021, which they accredit to efforts made to improve the quality of their spaces.

The proprietor’s revenue increased by ZW$18,51 million in inflation adjusted terms from ZW$71.66 million in the comparative period of 2020 to close at ZW$90.17 million in the period under review.

This increase is in turnover is said to have been driven by “rent reviews, higher turnover rentals and the occupancy level rising.”

Within the same period, overall occupancy scaled up by two percent to 89 percent which the company says was as a result of some renovation and revamping projects undertaken to improve interest in their properties and an increase in net lettings in CBD and retail.

The company reportedly spent a total of ZW$7.04 million during the quarter in the improvement and maintenance of their various properties.

However, the group says operations, despite slightly improving, still took a big hit from COVID-19 and the subsequent lockdown introduced during the period.

They say consequently, they were forced to delay rent reviews and planned maintenance initiatives while collections also slumped by 21 percentage points from 78 percent in the period to December 31, 2020 to 57 percent in the quarter being reviewed “as tenants were affected by the lockdown in generating income to service their obligations.”

Resultantly, the company is gloomy on their outlook and they are expecting a very slow recovery that will assume full throttle after this year.

Despite expected growth in economic activity, the property sector is traditionally the slowest to react due to the nature of the asset. The positive outcomes to the property sector linked to GDP growth will be felt post 2021, as demand for space will be driven by any positive effects on the productive sectors of the economy,” they said.

Rental yields are expected to remain weak due to the slow nature of price discovery of rentals, coupled by limited upside on rentals due to excess supply of space, while recent revaluations of properties will apply pressure to any growth in yields,” they added

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