ZIMRE Property Investments (ZPI) recorded a 5% decline in rental income in the five months ended May 2014 compared to the same period last year due to subdued rental growth.
VICTORIA MTOMBA
During the period under review, the company’s rent income stood at $1,5 million, down from $1,6 million in 2013.
Speaking at the company’s annual general meeting yesterday, ZPI managing director Edson Muvingi said the operating environment was characterised by liquidity constraints, rising voids and limited debt finance.
“Rental growth had been subdued and vacancy space is increasing. As a number of our tenants are closing business because of the environment, we have also been terminating leases that were not performing,” Muvingi said.
Project sales for the group went down 38% from May 2013 to $906 207 in May 2014.
Muvingi said the group was making progress on its Tynwald projects and was currently awaiting approvals.
“Transfer is in progress and 96% of the cost has been recovered and we hope to issue the title deeds soon. We will be having interviews with Zimbabwe Revenue Authority for the first 50 [residential] stands’ title deeds,” he said.
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The company’s Tynwald project has a total of 288 stands. The total value of the project is expected to about $3,7 million. ZPI expects to make a profit of $1 million.
Muvingi said ZPI hade realised a profit from the Zimre Park Masvingo which has 338 residential stands.
So far, ZPI has sold 178 residential stands.
Muvingi said the limited debt finance had affected the uptake of its development projects in Masvingo and Bulawayo as a result of the absence of mortgage financing.
Total income for the group went down by 22% to $2,5 million in May this year.
The group expects to begin its Ruwa residential project in August and would be completed in one year.
Muvingi said the group was waiting for the approvals from authorities for the Ruwa project.
