admindue to a fall in fair value gain on investment properties and investment income.
Pearl chairman Mr Elisha Moyo said the new business initiative will be undertaken through its operating division, Oyster Real Estate.
“Oyster Real Estate will leverage on the group’s relatively strong reputation, brand and utilise existing local and international strategic linkages in order to sustainably grow stakeholder value.
“The new business initiative, coupled with the ongoing cost management measures, are expected to boost revenue generation, improve margins and help contain costs,” he said.
He added that the new business initiative will offer a wide range of property services that include commercial property letting sales, valuations, development and project management to third parties.
Limited capital investment into the new business is projected in the first half of operations and activities will largely be carried out by the existing qualified and experienced staff.
Rental income for the business was 9,4 percent up at US$8,83 million largely due to new letting and rent reviews and the reopening of the George Square Shopping Mall in Kamfinsa that was under refurbishment.
As a result the average rental per square metre increased by 11,6 percent to US$8,18 from US$7,33 for 2011.
“At December 31, 2012, the value of the group’s investment properties grew by 9,6 percent to US$120,27 million underpinned by improving quality of the refurbished space and increase in rentals.
“The group completed the refurbishment of the George Square Shopping Mall at Kamfinsa Shopping Centre, Greendale, Harare, with achieved entry rental yield exceeding initial targets. The shopping mall was re- opened on June 21, 2012 with Pick ‘n’ Pay as the anchor tenant,” said the chairman.
However, rental yield eased to 8,6 percent from 9,8 percent as a result of slower growth in rentals relative to investment property values. The increase in rental income was, however, offset by a significant increase of 40,2 percent in property expenses to US$1,63 million that was mainly due to increases in general and specific provisions for credit losses and unallocated operating expenses.
In addition, the group also incurred a 5,9 percent increase in administrative expenses to US$3,19 million.
“In spite of cost savings achieved in group shared services, business communications and computer expenses, administration expenses increased by 5,9 percent to US$3,9 million due to increases in general office costs, fees and other charges, depreciation expenses and employment costs,” said Mr Moyo.
He said that the company was in a good position to exploit any spin-off that may emerge after the elections.
“The board remains optimistic about Zimbabwe’s economic outlook. The country has recently held a successful constitutional referendum which the board believes is a precursor to the holding of free and fair elections.
“Your board believes that post the elections the country is poised for economic growth and with such growth, opportunities for the real estate will increase. Your group stands ready and able to exploit such opportunities.”
Online Reporter