Zimbabwe’s real estate market continues to face challenges due to persisting foreign currency shortages, according to Mashonaland Holdings Limited’s reviewed condensed consolidated financial statements for the six months ended June 30, 2024.
The company reported that low liquidity has restricted the number of freehold property transactions, leading to a slowdown in market activity.
The property developer, however, said it is adapting by implementing low to medium-scale investment projects that offer compelling returns.
“The real estate market has been impacted by persisting foreign currency shortages in the formal sectors of the economy,” Mashonaland Holdings Limited board Chairperson Grace Bema stated.
“Low liquidity has restricted the number of freehold property transactions concluded in the market. In the development space, in an effort to manage market risk, property developers have opted to implement low to medium scale investment projects which offer compelling returns.
“The occupier sub-market has witnessed constant growth in voids particularly in the CBD office segment which has been affected by growing tenant preference for suburban space.
“The retail and industrial segments continue to show signs of growth with tenants looking for space in strategic locations which offer visibility and access to markets.
“Residential property continues to offer investment opportunities for developers, however, the increasing cost of construction represents a headwind against sustainable growth in this segment.”
The company further noted that residential property development remained a viable investment opportunity. The increasing cost of construction, however, posed a challenge to sustainable growth in this segment.
Despite the challenges, Mashonaland Holdings Limited reported a 15% increase in revenue and a 72% improvement in profit after tax, driven by improved operating performance and a capital gain on investment property.
The company said it remained focused on completing its ongoing property development projects, including the Pomona Commercial Centre Development, which is expected to be completed in the fourth quarter this year.
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