Online Reporter
Business Reporter
Financial services giant Old Mutual Zimbabwe has confirmed it is selling several of its properties in Harare’s Central Business District (CBD), including the iconic Old Mutual House at the corner of Speke Avenue and Sam Nujoma Street.
The move is part of a strategic shift to offload older, less adaptable buildings and focus on modern, re-purposed assets.
The decision was revealed by chief executive officer Samuel Matsekete in an exclusive interview.
Referring to the disposal of Old Mutual House, Mr Matsekete said: “We are just trying to make them ready for the buyer. In fact, maybe the buyer is already coming to start to do some work on it. So that’s why those ones will probably be 100 per cent empty, or near that.”
According to Mr Matsekete, the properties being sold were designed for large, single tenants and lack the flexibility to be sub-divided for smaller businesses, a growing trend in the commercial property market. This, he said, has led to persistently low occupancy rates in the CBD portfolio.
“The ones that we exit, it’s usually because if you look at some of those older properties, they were designed for larger tenants who occupy more space rather than designed for smaller tenants trying to occupy,” Mr Matsekete explained. “So they don’t have as much optionality.”
The sale of its properties signals a major recalibration of Old Mutual’s real estate strategy, moving away from a reliance on traditional CBD buildings and towards a portfolio more aligned with contemporary commercial property trends.
While Old Mutual is exiting some CBD properties, it plans to retain and repurpose others. The company is exploring options such as sectional ownership, allowing businesses to own a part of the space rather than renting, a model Mr Matsekete said caters to a new type of investor.
He acknowledged that newer properties, such as retail parks and office complexes, have significantly higher occupancy rates than their CBD counterparts. “That’s the one that weighs us,” Mr Matsekete admitted, referring to the challenge posed by older buildings.
In response to a question about the success of newer shopping centres, such as Highlandpark and Madokero Mall, while malls like Highglen and Westgate seem to be struggling, Mr Matsekete conceded that tenants are drawn to newer properties.
“I think tenants always view newer properties more favourably. I mean, even as households, if I’m offered space in an older place compared to a newer place, I’m likely to look at the new fittings in the newer place and say this looks more comfortable unless there are other counter arguments, for example, if services are better and better established with the older properties.”
To counter this, Old Mutual has begun refreshing its own retail assets, including the Westgate shopping centre, to enhance their appeal and services.
“If you visit Westgate today it’s looking different to how it looked five months, six months back in terms of the level of activity. And this has been because we have also started to do some of the refreshments, enhancing the bouquet of services available there. And it’s an effort that we will continue and it is an effort that naturally takes a bit of time,” Mr Matsekete explained.
He also distinguished between “transit shopping centres,” which cater to quick purchases, and “destination shopping centres,” like Westgate, which provide multiple services in a single location. The company believes there will continue to be a market for both models and the company plans to maintain a mix of destination and transit shopping centres depending on location, focusing on offering a convincing bouquet of services to attract and retain customers over the long term.
Peter Tanyanyiwa